Terry Savage: Credit card dangers

Terry Savage, Tribune Content Agency on

Everyone likes a little recognition — a sense of being known and appreciated. Perhaps that’s why I must admit I get a little rush when I’m shopping online, choose PayPal to pay and instantly get a message that says: “We recognize you on this device, Terry. You don’t have to sign in!” That always makes me smile.

It’s as if I’ve gained approval for the purchase. The blank spaces are filled in with my credit card number, and the screen even knows where I likely want my package sent. And so it goes, with my purchases piling up on my credit card balance. And that is the easy trap.

Yes, I pay in full every month. But evidence is mounting that consumers are building balances that will take them years to repay, even as interest on revolving balances is averaging near 20% — and far higher once the lender knows they have you trapped.

Total consumer debt climbed by $351 billion in the July-September 2022 period — the largest quarterly increase since 2007. Total household debt jumped to a record $16.5 trillion — up more than 8% from a year ago.

That huge total includes mortgage debt, which has climbed as rising home prices require larger mortgages, as well as auto loans. But it doesn’t include the “buy now, pay later” debt which is typically not reported to credit bureaus. So, be very careful about clicking on that box that offers “four easy payments” with immediate approval.

Consumer credit card debt now totals $930 billion — and is likely to surpass $1 trillion after this holiday season. That’s up 15% from a year ago — the largest percentage jump in more than 20 years.


Economists call those “MEGO” numbers. That stands for “My eyes glaze over!” But don’t let your eyes be fooled by the last-minute, post-pandemic urge to live (and shop) for today — and pay tomorrow.

When the bills come in January, you’ll be astounded at the total if you aren’t following your balances online. With a sign of relief, you’ll realize that you can barely afford the “minimum required payment.” So your credit score won’t be dinged. But that doesn’t tell the whole story, as the mountain of debt is still accruing interest charges.

As a matter of fact, the way some card companies calculate the minimum monthly payment, it could take as long as 31 years to pay down the initial balance. And by the time you finish paying it off, your total interest bill will be four times the amount you original charged!

Long after those concert tickets have faded from memory, and the clothes have been given away, you’ll still be paying. Is it worth it? Ask yourself — before you click to order with “free shipping”!


swipe to next page



Rubes Jack Ohman Adam Zyglis Non Sequitur A.F. Branco Darrin Bell