BIRMINGHAM, Ala.—Consumers did not hesitate to pull out their plastic in December, racking up a sizeable amount of new credit card debt during the Christmas holiday.
Revolving debt, most of which is credit card debt, rose $5.8 billion during December, an annualized rate of 7.9%, pointed out Bill Hardekopf, CEO of LowCards.com. “It was the largest increase in eight months. This followed nearly a billion-dollar drop during November.”
According to the latest Federal Reserve figures, consumers now have $887.9 billion in revolving debt, an annualized increase of 2.9% during the fourth quarter of 2014. “This was the second consecutive quarter where the annualized increase was 2.9%. In fact, every quarter of 2014 showed an increase in revolving debt,” explained Hardekopf.
Overall consumer credit rose at an annualized rate of 5.4% during the fourth quarter. Non-revolving credit, which includes educational and automobile loans, rose nearly $9 billion, a 6.3% annualized rate.