Credit cards make it easy to buy the things you want without carrying cash around. As long as you are in the introductory period, there is no problem. But when the high interest rate kicks in and you have a balance, it can be hard to reduce your debt.
New Interest Rates Higher Than Ever
Recently, issuers of retail credit cards have quietly increased their interest rates. Interest rates today on some of these cards are higher than ever—reaching as high as 30.4 percent, says CNBC. One retail credit card charges as much as 30.74 percent. Regular credit cards charge an average of 19.04 percent, which is also higher than before.The higher interest rates, NerdWallet claims, are because charge-offs went from 3 percent to 4 percent between 2012 and 2019, but spiked to 10 percent after the 2008 recession. Credit card companies have a higher risk than before. They also have no collateral since a credit card is an unsecured loan.
