1-in-3 Texans would cut ties with loved ones for a year to clear credit

1-in-3 Texans would cut ties with loved ones for a year to clear credit Subhead NEWS-VIEWSTATE News Staff Tue, 06/04/2024 - 12:25 Image Body

In an era where Americans face unprecedented credit card debt of $1.13 trillion, the cycle of debt repayment - often confined to interest alone has become a relentless burden for many. This has cast a shadow over their financial freedom. CardRates.com conducted a survey of indebted Texas consumers, posing a hypothetical question: Would you be willing to have no contact with friends or family for a year if it meant your credit card debt would be canceled?

Surprisingly, 1 in 3 respondents from the Lone Star State said they would accept this offer.

Participants unable to pay off the interest on their credit card debt were also asked which lifestyle change they would be most willing to make to address the issue. An overwhelming 75% said they would cut out all non-essential spending, such as eating out and entertainment, while 17% said they would take on a second job or side hustle. Only 4% said they would consider downsizing their living situation (e.g., moving to a smaller home or paying less rent) or giving up a car and opting for public transportation.

Additionally, 83% said they would be willing to use older technology (phone, computer, car) longer than usual to help pay down their debt.

When asked about their spending priorities post-debt clearing, 50% of respondents said they would strike a balance between saving and reasonable spending, while 31% said they would focus on building their savings. But a concerning 15% admitted they would most likely revert to their previous spending habits. A small minority (3%) of respondents said they would spend money on a few big-ticket items they had been postponing, such as purchasing a car.

CardRates.com found that 1 in 5 respondents admit that their friends' spending habits influence their own, especially in relation to debt.

'Our survey reveals the profound impact that credit card debt has on people's lives, leading them to consider extreme measures to regain financial freedom. While it's understandable that people would go to great lengths to eliminate their debt, it's concerning that many would be willing to sacrifice their digital privacy or personal relationships to do so. This highlights the need for better financial education and support to help people manage their debt in a sustainable way,” says Ashley Fricker, Senior Editor at CardRates.com.