Austin Offers an Anomaly in Nationwide Credit Ratings

In the midst of one of the states that ranks the highest among American states in terms of average credit card debts among the citizens, the city of Austin has reached a new high.

With debts reaching an average of 6,479 dollars each, Austin has surpassed the Texas state average by more than 13%, and the Texas state average was already an exceedingly high one, sitting at 5,819 dollars, higher than the national average of 5,729 dollars. This represents a strong 0.9 percent increase from just a year ago and places Austin at a national high when it comes to out of control credit card rates.

It would be all too easy to point to the behavioral patterns of Austin as emblematic of the kinds of problems threatening the United States economy as of late, if not for one strange fact. Despite having such an astronomically high credit card debt average, the people of Austin seem to be much better than most at another key part of credit management: making their payments on time. The percentage of Austin residents with more than three months delinquency in making their payments was just 1.01 percent, whereas the national average was a much higher 1.21 percent. Even while the US average is at an all-time low, Austin still manages to outdo them.

So, what can we learn from this situation? Firstly, we must question just why it is that the city has such a high amount of unpaid credit card debt. The most obvious answer might be, of course, that Austin simply has a much higher cost of living than other comparable urban areas. However, this is not entirely revealing.

First of all, much larger metropolitans areas such as New York City have a much higher cost of living without the accompanying disproportionate debt spike. Moreover, one has to question why this is a factor at all. After all, if cost of living is affecting credit card debt, it’s a sign of a much bigger problem: people are relying on credit cards not for emergencies, but to live, to get by in day to day situations. This is certainly a concern that must be addressed, especially for individuals who live in high cost-of-living areas such as Austin.

When it comes to your budget, are you relying on credit cards to bale you out month after month? If you’re relying on credit cards to pay your rent or your monthly utility bills, then the problem you’re facing is a significant one, and it won’t be long before this unwise practice catches up with you and leaves you with immense debt.

However, the other factor, the relatively low number of Austin residents not paying their bills, is also worth examination. While it’s not at present known exactly what accounts for this trend, it does reveal a need to examine debt on a holistic level, looking at all contributing factors and all social classes that contribute to the overall picture of debt. Without such a clear image of what’s going on financial, repairing the situation will be all but impossible.

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