3 Simple Ways Retirees Can Control Their Credit Card Debt
One of the biggest threats facing retirees’ finances is not that they’ve saved too little–it’s that they owe too much. While the average credit card debt among all U.S. households is about $5,700, that number jumps to $6,351 for those age 65 and over. A retiree’s average debt on credit cards is more than double the maximum monthly Social Security payment. So it’s not surprising that credit card debt is a huge financial concern for seniors, right behind medical bills and just ahead of paying for utilities. [CNBC]
Walmart’s Showdown with Visa in Canada Deepens
Shoppers who use Visa credit cards to pay for their purchases at some Walmart stores in Canada may be in for a shock. The chain will stop accepting Visa credit cards at its 16 stores in Manitoba province, the latest escalation in a tiff over credit card transaction fees. Although still limited to a fraction of Walmart’s vast network, the fight reflects a deepening divide over the transaction fees Visa charges in Canada, where Walmart operates more than 400 stores. The boycott started this summer with Walmart’s three stores in Thunder Bay, Ontario. [USA Today]
Prepaid Cards’ Growing Popularity Catches Regulator’s Eye
Prepaid cards, which started out as simple gift cards from retail stores, have morphed into popular financial-management tools with functions that rival bank checking accounts. Now regulators are playing catch-up, with plans to roll out a rule this fall that would bring oversight of the sector closer to regulations covering banks. The coming rule from the Consumer Financial Protection Bureau marks the federal government’s first comprehensive effort to police the market, which caters to tens of millions of Americans, many of whom are lower-income and have either no or limited access to regular bank accounts. This year, nearly $300 billion is expected to be loaded onto GPR cards, almost double the amount in 2010. [The Wall Street Journal]
Subprime Credit Card Limits Reach 5-Year High
Total credit card limits for the subprime market reached a five-year high during the first half of 2016. These limits are now at $6.4 billion for subprime and deep subprime cardholders. This follows a Federal Reserve Bank of New York survey that found nearly half of subprime borrowers now have a credit card, which is quickly approaching pre-recession levels (60%). Despite the increasing card limits and card availability for subprime borrowers-defined as those with credit scores below 620-the delinquency rates for credit cards has declined since 2011. The delinquency rates for subprime borrowers over a five-year span dropped 6%. Overall delinquency rates across all markets have declined by 43% from the second quarter of 2011 to the second quarter of 2016.