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Ahead of Black Friday, some shoppers still have holiday debt from 2020

As the holiday shopping season shifts into high gear, Americans are ready to shell out big bucks.

This year’s vacation spending is expected to break records, according to a forecast from the National Retail Federation.

On average, buyers will spend around $ 762 on friends and family, according to a separate report from NerdWallet.

And yet, 29% of shoppers who put Christmas presents on a credit card last year – that’s over 35 million people – are still paying for those purchases, the report also said.

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As Black Friday and Cyber ​​Monday approach, Higher prices and product shortages are forcing some shoppers to spend even more to get the items they want for the holidays.

It pushes up card balances after Americans paid off a record $ 83 billion credit card debt in 2020, helped by government stimulus checks and fewer discretionary shopping opportunities.

Overall, credit card balances increased by $ 17 billion in the third quarter of 2021, according to the most recent data from the Federal Reserve Bank of New York.

The average credit card balance is now $ 5,525.

However, under ordinary circumstances, credit card debt is particularly difficult to repay, especially with an average annual percentage rate of over 16%.

Eric Ellman, senior vice president of public policy and legal affairs for the Consumer Data Industry Association, advises buyers to think about any new debt they incur this year.

“When consumers take over, there are obvious implications,” he said. “Their credit scores could go down, which could increase the cost of future borrowing. “

“You should go into every purchase with an eye to the future,” Ellman said.

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