Did you rack up a lot of holiday debt on your credit cards? If so, you're not alone. The average person owed more than $4,200 in bankcard debt at the end of 2010, according to research released Wednesday from Experian, one of the three major credit-reporting agencies. On the bright side, December credit card debt was down more than 4 percent compared to 2009 data.
Residents of some cities were deeper in credit card debt than others.
In a press release, Experian listed the 25 American cities with the highest amount of bankcard debt in December 2010. San Antonio lead the pack with an average bankcard balance of $5,177; followed by Jacksonville, Fla., with an average balance of $5,115; and Atlanta with an average debt of $4,960. Another Florida city, Orlando, ranked the lowest on the list with $4,525 in credit card debt.
Though Americans had less credit card debt than in the previous year, they were using more of their available credit. Average utilization on credit cards was more than 30 percent, up nearly 10 percent since 2007. The surge was due in part to the fact that Americans don't carry as many credit cards. The average number of cards held has dropped 23 percent since 2007, to 1.97 cards.
When utilization climbs, your credit score can suffer. That's true anytime of the year, not just around the holidays. A big component of FICO credit scores is how much debt you have, part of which comes from how much available credit on revolving accounts such as credit cards is in use. According to FICO, people with the highest FICO scores have credit utilization rates of 7 percent or less.
If you have credit card debt, tackle your balance using a pay-down strategy.
How much of your holiday expenses did you charge to your credit cards?
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