Recently released data suggests that consumers in Michigan and beyond are tightening their belts and making wiser decisions concerning the use of credit. In August, U.S. consumer debt grew $13.6 billion. However, the majority of that debt was taken on in the form of government-backed student loans. Consumer debt, such as credit card debt, does not appear to have played a significant role in the increase.

It may be the case that Americans are charging less based on a sluggish job market and the overall slow pace of economic recovery. Many may still feel that their job security is not guaranteed, and that they would encounter difficulty finding new work if their present position was lost. Still others may be changing the way that the approach spending and debt as they watch the larger economy struggle to right itself.

Consumer debt falls when people begin to change the way that they view the availability of credit. In tough economic times, and perhaps at all times, individuals should use credit to cover emergency and unexpected expenses. Credit should be viewed as a last resort, not as an open invitation to make purchases that are not needed or budgeted for.

Consumer habits may account for the debt problems facing some Michigan residents, but there are many other factors at play when individuals reach an untenable level of debt. In many cases, medical issues, job losses or high consumer interests rates and fees are factors behind serious credit card debt problems. When a consumer has amassed a volume of debt that surpasses his or her ability to pay, the need for debt relief becomes urgent, and options such as personal bankruptcy merit careful consideration.

Source: buffalonews.com, Are you playing it too close to the edge with your finances?, Susan Tompor, Nov. 4, 2013