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If one of my recent columns, “The big lie about credit card debt,” seems familiar, it’s because it’s basically a rewrite of a column I’ve written at least twice before for MSN Money.
But the myth that the average American has $9,000 in credit card debt is a hard one for many people to give up, judging by the responses on the Your Money message board. Those who are drowning in credit card bills want to believe they’re normal (which they most emphatically are not) and those who have avoided credit card debt like to believe others are much worse off (clearly, some are, but most American households still have no credit card debt).
Not that there isn’t cause for alarm. Debt payments as a portion of disposable income have been rising, from around 11% in 1980 to over 14% today, as this Federal Reserve chart shows. There’s been a particularly big jump in mortgage debt. Part of that is likely folks tapping their home equity to make home improvements and pay off credit card debt (generally the top uses of home equity lending, in that order), but most of the rise in mortgage debt is due to more expensive housing and looser lending standards.
