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from the I-can-spend-until-I-reach-my-credit-limit,-right? dept.
If you have credit card debt, it may be time to scale back what you spend on luxury purchases.
But we’re not talking about doing without small luxuries like your morning coffee or an afternoon snack – things like your car loan or lease, leisure travel, dining and more can make a bigger difference.
A new CreditCards.com poll shows U.S. consumers who have credit card debt are outspending debt-free households in seven of nine discretionary spending categories (see chart). However, few are willing to cut back on any of their luxury purchases.
In fact, 18 percent of Americans who have credit card debt are unwilling to trim expenses in nine categories, including dining out, leisure travel and clothing (see chart). This despite the fact that the average credit card APR is nearly 18 percent.
[...]Our luxury spending poll also found:
- Many can live without dining out. Dining and takeout is the category all respondents – in debt or not – are most willing to cut in half. Still, less than half of those with credit card debt (48 percent) would trim their dining budgets, which average $2,186 per year.
- But vacations are a big budget item many won’t budge on. The average household with card debt spends $2,211 per year on leisure travel. But only 3 in 10 of those respondents would be willing to cut their travel spending in half.
- Cars, haircuts and cellphone plans are the biggest must-haves. The three categories people in debt were least willing to cut in half are personal care and beauty (23 percent), cellphone services and upgrades (25 percent) and car loans or leases (26 percent).
- Cut my streaming? You’re dreaming. Only 39 percent of respondents with debt would be willing to cut back on subscriptions services such as Netflix, Spotify and Xbox Live. However, at $1,198 per year, it’s the second-least-costly luxury expense among this group.
https://www.creditcards.com/credit-card-news/luxury-spending-poll/
(Score: 3, Interesting) by JoeMerchant on Friday July 12 2019, @08:58PM (2 children)
~$5150/yr for cars, $429 per month - seems pretty steep, unless that's for two cars...
We have 4, cars currently - which is not the most efficient on insurance, but it's not double what two would cost either, and there's a certain reliability cushion about being able to fix a broken one at leisure rather than needing it immediately.
Thinking about our car expenses of the last 30 years:
A lot of this is lifestyle choice - right now we're choosing to have 4 older cars, it seems quite a bit cheaper than two newer ones. Maintenance is slightly higher on the older cars, but nothing like finance charges and loan interest.
🌻🌻 [google.com]
(Score: 2) by richtopia on Friday July 12 2019, @09:20PM (1 child)
The article also does not state if these numbers are for a family or averaged to costs per person. As a single guy in my 30s I understand I spend a lot less annually than my peers who have children.
(Score: 2, Informative) by Anonymous Coward on Saturday July 13 2019, @12:14AM
Yes it does -- numbers are PER HOUSEHOLD.