Big credit card debt is a big problem. Collectively, Americans are on the hook for more than $900 billion, according to CardHub, the highest total since the 2008 recession.
Not only are Americans racking up debt at an alarming rate, but we're also in denial about how much we owe. When people are asked about the total balance on their credit cards, their estimates are 37% percent lower than the amounts reported by lenders, according to research by the Federal Reserve Bank of New York.
Whether they know exactly how much they owe (and how much they'll end up paying over time on their debt), many Americans fear they'll be shackled to debt for the rest of their lives. Twenty-one percent of people surveyed by CreditCards.com in 2015 said they feared they would die in debt.
Based on data from CardHub, they have reason to be concerned. The website, which helps people search for and apply for credit cards, recently put together a list of the average credit card balances in nearly 2,500 US cities, based on data from credit reporting agency TransUnion. Using median income data for each city, they also determined how long it would take the average resident to pay off their debt and how much they would pay in interest (assuming an average interest rate of 14%).
In many cities, payoff times could take a decade or more. CardHub determined it would take over 32 years for people in College Station, Texas, to pay off their average debt of $5,601. Over that period, they'd fork over more than four times their initial debt - $25,221 - in interest. People in Murray, Kentucky; Marquette, Michigan; and Stillwater, Oklahoma, were also looking at payoff periods of more than 10 years.