Credit card interests are at historic highs as the Federal Reserve has raised interest rates, hoping to combat the highest inflation in four decades. At the same time, pandemic-era aid such as stimulus payments, the child tax credit, increased unemployment benefits, and a moratorium on student loan payments has ended. Wage gains haven’t all kept up with inflation, which hits lower-income consumers harder, and rent increases have eaten into savings some consumers may have built up during the early years of the pandemic.
A perfect storm is brewing. What can consumers do to protect themselves and their finances, given the current challenging economic climate?
Silvio Tavares, President and CEO of VantageScore, recently spoke with the Associated Press, citing recent CreditGauge findings which indicate that delinquencies have now exceeded their pre-pandemic levels.
Younger and less affluent people are experiencing challenges,” he said. “And high interest rates are having an effect.
Tavares said the most important thing a borrower can do is to know their credit score and keep up with payments to avoid paying additional interest on revolving balances and debt. He cautioned consumers not to over-extend themselves with “buy now, pay later” loans, which are increasingly available “at every checkout.”
Read more here: AP News
To read the latest VantageScore CreditGauge insights, visit https://www.vantagescore.com/lenders/credit-gauge/.
