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Inflation pushes low-income households to take risks with loans, credit


Inflation pushes low-income households to take risks with loans, credit

Some Americans rely on credit cards to make ends meet.

  • Consumer borrowing is rising as inflation nears 40-year highs and Americans resume pre-pandemic activities like travel and restaurants.
  • A growing share of these cash-strapped households are falling behind on car loan, credit card and personal loan payments.
  • Total household debt remains historically low.

Linda Hampton was already struggling to pay her credit card bills last year because of thousands of dollars in expenses from her notary office.

Then inflation started to soar in mid-2021, especially gasoline, utility and grocery prices.

“I just started using my credit card for everything,” Hampton says, even for a combined electric, natural gas and water bill that has more than doubled since 2020 to $864 last month.

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