In its ongoing efforts to analyze issues affecting the future of consumer finance, we have released the second in a series of Consumer Finance Research Briefs, based on information derived from Ohio State University’s Consumer Finance Monthly (CFM) survey. Consumer Debt Stress and Credit Cards, by Filene Executive Director and CEO Mark Meyer, explores debt- related stress with a focus on credit card debt.
The analysis seeks to address the following research questions:- Did levels of consumer debt stress increase in 2007 from 2006 as the sub-prime mortgage crisis publicly unfolded? The CFM shows that consumers in top stress categories who worry about overall debt rose from 14.7 in 2006 to 16.2 in 2007.
- How do levels of consumer debt stress vary by credit card debt indicators such as total credit card debts, missed payments, accounts sent to collections, and previous bankruptcies? A prior bankruptcy filing, for example, increases the likelihood that a survey respondent will report high levels of debt- related stress. This suggests that bankruptcy is merely a temporary solution to an ongoing problem.
- How do levels of consumer debt stress vary by demographic variables such as age, annual household income, gender, race/ ethnicity, and marital status? CFM data indicate that individuals with higher overall debt stress levels have lower household incomes than do those with lower debt stress levels. Those with the lowest household incomes are likely to endure the highest levels of debt- related stress.
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You would be interested in our research we did on the tie between debt and depression. See http://myvesta.org/news/releases/112901PRDepression.html
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These are interesting results on the survey about stress. Although the results were kind of expected, it is still revealing. The lesson to all of these? i think if one can’t handle paying the credit cards on time, then he should stay away from them except in case where it is absolutely necessary.
Evelyn Guzman Debt Challenger
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I need credit repair help because I’ve spent the majority of my adult life trying to keep up with the Joneses. As an American, there is an undeniable pressure to live the “American Dream”. I just think it’s ironic that the American Dream has become almost identical for everyone—big houses, fancy cars, a white picket fence, and expensive things. It’s pretty evident that all of these luxuries and material goods aren’t making Americans happy. Instead of happiness, I feel guilt and stress when I make purchases at the store. I feel guilty for buying something I know I don’t really need, and I feel stress because I know my credit card bill is going to be huge. I, like many Americans, need to reevaluate what really makes us happy. Focusing on material goods isn’t making me happy. All these things that I have are just weighing me down emotionally and financially. The simple things in life make me happy—like spending time with my kids, getting outdoors, and talking with my husband. The best part is none of those things cost money. So why then are Americans so consumed with spending money on worthless things? Americans are addicted to shopping and spending to impress each other. I’m sure my designer clothing impresses a few people, but if they knew how much credit card debt it took to dress like this, they wouldn’t find it as impressive. Keeping up with the Joneses is overrated, and I’ve paid a heavy price to try to live the “American Dream”. I’m going to start living my own dream—the real American dream. I’m going to start managing my money, saving my money, and paying off my debts. My credit score is also extremely low, so I’m going to get credit repair help. With less debt and credit repair I can focus on the things in my life that truly make me happy—my family. Another thing here is I learn how to be satisfied with what I have right now. Click to read more on Credit Repair.
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