Montana Improving But Still Owes Millions in Credit Card Debt
Missoula, MT (KGVO-AM News) - The financial website Wallet Hub actually reported a sliver of good news this week on the topic of Montana’s overall credit card debt.
KGVO News spoke with Wallet Hub analyst Jill Gonzalez said Montana pales in comparison with larger states, but still owes thousands per household in credit card debt.
Montana's Credit Card Debt Increase was 7th Lowest in the Country
“To say that Americans have a lot of credit card debt would be an understatement,” began Gonzalez. “Right now our collective tabs did over $1.2 trillion, which is a record but fortunately for Montana, when we look at it from quarter to quarter, we see that it had one of the smallest credit card debt increases in the country last quarter. In Montana right now the average household has around $7,200 of credit card debt. You compare that to more like $10,000 in say, California or Texas.”
Gonzalez said household credit card debt increased again over the last month in Montana.
Montanans added $131 Million in Credit Card Debt in 2023
“On the household level, in Montana, the increase was $302 just over the last quarter.” She said. “However, when we're adding that all up across the entire state, that's $131 million that the state added on to its collective tab; although that sounds like a lot of money, it's a lot lower than most other states that are upwards of billions of dollars.”
Gonzalez said the weeks before the free-spending holiday season are a good time to knuckle down and pay off as much credit card debt as possible.
“Now's a good time to maybe pay some debt off before that big fourth quarter haul begins,” she said. “To do that you really want to be strategic. Say you have three credit cards, instead of just sprinkling any extra cash across all three, really focus on the one with the highest APR, the highest interest rate and put any extra money towards that card. Then, pay the minimum balances for the rest and continue on that path until it's paid off and move on to the next card.”
Credit Card Interest is also Higher due to the Federal Reserve Raising Rates
To make matters worse, interest on credit cards has also risen, thus increasing the debt still further.
“Interest rates are actually the highest they've ever been right now on credit cards,” she said. “A lot of that is due to the Federal Reserve continuously raising rates and I do expect one more rate hike before the end of the year. So again, you want to make sure that you are paying off that debt at the cheapest time that you can.”
All that being said, Montana’s credit card debt increase does rank as the seventh lowest in the nation.