Credit Report Repair

Not As Many Charge Cards In Use

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Along with news about the unemployment rate, there was some other news on Wall Street. Americans are using fewer credit cards, and less use is being made of the cards they do use. As there is less short term credit accessible, fewer individuals want to use their credit cards as a source of instant cash. Americans are saving more than they used to. Consumer goods are a huge part of the economy, and purchasing non-essential goods has dropped off which is counterproductive to the economy.

Credit card use falls

According the Wall Street Journal, fewer individuals are using their credit cards for consumer purchases. The amount of revolving credit (like credit cards or financial institution lines of credit – not like mortgages, payday cash advances, cash advances or student loans) getting used in the Americas has been declining. In fact, the use of revolving credit has dropped each month for the past 21 months consecutively. At this rate, the credit card businesses are going to need a payday loan themselves.

Unemployment has a lot to do with it

People can’t spend cash on non-essential goods during recessions. Using cash gets closer to the rule, instead of the exception. The thought of getting the same couch as the Joneses’ and paying the minimums for decades just doesn’t seem justifiable anymore. Accordingly, the national savings rate went up. In April, the national savings rate was 6 percent, and for June, it is up to 6.4 percent, as outlined by the US Commerce Department.

Individuals get more frugal when they’re less secure

If you don’t know you’ll be stable by the end of the year, there’s no point in using credit for making big purchases. Unless you are getting a loan to get some debt relief, there’s no point in going further into debt if security is the goal you are after.

Additional reading

Wall Street Journal

http://online.wsj.com/article/BT-CO-20100806-715007.html

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