Consumers respond to warm weather in May by increasing spending
As temperatures warmed, and the equity and housing markets strengthened, consumers increased spending in May.
According to First Data Corp's monthly SpendTrend report, May dollar volume growth increased 6 percent, up from 5.1 percent in April. Credit card spending increased 7.5 percent, while PIN debit jumped 2.4 percent.
"The combination of warmer weather, lower gas prices, an increase in home prices and a record-breaking stock market encouraged shoppers to spend in May," said Krish Mantripragada, senior vice president of Information and analytics solutions for First Data.
With more spending on plastic, credit card debt was up as well in May for many consumers, unless they paid their balances in full at the end of the month.
Higher credit card balances can lead many people into financial difficulties so it is important these consumers know how to control and pay down their debt.
1. Take stock of all cards and debts
The first step to controlling credit card debt is to understand how much you have. You should write down the balance, interest rate, due date and minimum payment you owe for each card.”br />
This can allow you to know exactly how much money you will need to set aside each month in order to pay all of your cards on time.
Once you have an idea of how much debt you will have to pay off each month, it is time to consider a strategy to help reduce your balance. One of the best ways to rid yourself of debt is to consolidate your debt to one card. This can be done through a balance transfer, and its main benefit is to save you money on interest. Generally, credit card providers will offer 0 percent APR on balance transfers for an extended period of time, in which you should do your best to pay off your balance.
3. Stop charging purchases
Your payment strategy wont be successful if you continue to pay for items with your credit cards so you will need to stop charging purchases. If you are finding that this is difficult, store your cards in a safe place at home so you don't have them on you when you are shopping. If all else fails, you may want to consider cutting them up and asking for a replacement once your debt has been paid off.