Some Chicago residents grow credit card debt with medical bills

The budgets of many Chicago-area families are stretched thin by a rising number of costs. According to a recent nationwide survey that polled adults who have held credit card debt for three months or longer, medical bills represent one significant expense that many people are having a more difficult time paying. While some have attempted to cut costs by reducing medications and visits to their physician, some medical care is unavoidable.

A number of people have used their credit cards to cover out-of-pocket costs, and at least 50 percent of people classified as medium-income or lower continue to carry a balance from those expenses. But credit cards see far more use than at the doctor's office. Approximately 40 percent of survey respondents said that they did not have enough cash to pay their basic monthly bills in full, so they charged some of those costs to their credit cards. This has left some consumers seeking debt relief in difficult economic times.

The survey revealed some positive information about credit card debt, however. Over the past couple of years, the average debt balance has fallen, as has the percentage of cardholders paying late fees to card companies. Despite these improvements, the average credit card debt load exceeds $7,000.

The combination of medical costs and credit card debt can be a difficult duo for many consumers. Medical treatment can be very expensive without insurance, and if placed on a credit card, high interest rates can quickly increase the outstanding balance beyond a person's control. In appropriate circumstances, filing for bankruptcy can provide consumers with the debt relief and fresh start they need. Bankruptcy does have consequences, however, so it is important to weigh the pros and cons before making a decision.

Source: The New York Times, "Medical Costs Contribute to Credit Card Debt," Ann Carrns, May 22, 2012.

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