Americans cut credit card debt by nearly $83B during pandemic
Oxnard, California leads the way when it comes to paring down credit cards
Though 2020 was a year most people would like to forget, many Americans managed to significantly cut credit card debt.
According to a study released Monday from WalletHub, a personal finance website, Americans collectively got rid of a record $82.9 billion in credit card debt.
A stack of multicolored credit cards. (iStock)
The figure is significant, given that consumers have added an average of $54.2 billion in credit card debt each year for the past decade.
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Still, the U.S. has a long way to go in paying off the nearly $1 trillion that Americans collectively owe to credit card companies – even though the prospect of reducing the debt down to zero is highly unlikely to ever happen.
The outlet projects that the average household balance and the nation’s credit card debt will rise as the economy begins to reopen amid declining COVID cases.
The WalletHub report, citing data from TransUnion and the Federal Reserve, showed Oxnard, California as having paid off the most debt ($65.3 million), and Burlington, Vermont adding the most ($49.9 million).
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WalletHub analyst Jill Gonzalez told CNBC that 2020 was the second year in more than 30 years “we’ve ended the year owing less credit card debt than we started with.” The first year was in 2009, at the height of the Great Recession.