The Credit Card Crutch That Keeps You in Debt
Life + Money

The Credit Card Crutch That Keeps You in Debt

While a credit card is a must-have these days, some Americans may be a little too reliant on their plastic. 

One in five people couldn’t make ends meet without the use of a credit card, according to a recent National Foundation for Credit Counseling (NFCC) online poll, released Tuesday. 

Related: Credit Cards May Overtake Cash for Small Purchases 

Additionally, nearly a quarter of respondents said they would have to make significant changes to their lifestyle if asked to live without a credit card and solely on cash. 

“It is a warning sign if a person isn’t able to manage his or her daily lifestyle without the use of credit cards, as this is a dangerous habit that could lead to serious financial distress,” noted the NFCC in a press release. 

In 2013, the average consumer who sought financial counseling from an NFCC member agency had between five and six credit cards, and their total unsecured debt equaled to half of their annual household income. 

At the same time, more than three in five millennials and 35 percent of adults over 30 don’t have a credit card at all, which could also be a problem, as noted by a study out Monday by

Related: Credit Score Change Could Set Up Consumers to Fail 

Without a credit card, consumers are failing to build a credit history, which could come back to haunt them when they decide to purchase a home and apply for a mortgage. 

“Millennials may think they’re staying out of financial trouble by forgoing credit cards, but they’re actually doing a disservice to themselves and their credit scores,” noted Jeanine Skowronski,’s credit card analyst, in a release. 

Here are some basic rules to make sure your credit card serves you in the best way: 

  • Do pay the full balance on time each month.
  • Don’t seek cash advances.
  • Don’t move debt around through balance transfers.
  • Don’t try to obtain new lines of credit if the existing ones are near their limit. 

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