Americans Are Turning to Even More Financing Options as Savings Run Dry

Couple Credit Card

An increasing number of Americans are turning to buy now and pay later (BNPL) services like layaway as they continue to drain their savings and interest rates on credit cards grow, according to Reuters.

Credit card debt, with its high interest rates, in aggregate exceeded $1 trillion for Americans in 2023 for the first time ever, leading many Americans to use BNPL services that charge a far lower 2% to 8% fee instead, masking a considerable source of debt, according to Reuters. The search for cheaper financing follows declining savings for Americans as they spend through their reserves, holding only $768.6 billion in October, down from over $1 trillion held in May and even further from the all-time high of almost $6 trillion held in April 2020.

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Proposed Banking Regulations Won’t Save Sector But Will Hurt Your Wallet, Experts Warn

The Senate Banking Oversight Committee met with top U.S. bank CEOs on Wednesday about the possible effects of new regulations, proposed in July, that would raise capital requirements, titled Basel III endgame, according to CNBC. The new restrictions would not tackle problems that caused the most recent banking crisis earlier this year and would disproportionately affect smaller borrowers, like average Americans, by tightening credit conditions and restricting access to affordable debt in the form of mortgages, credit cards and more, experts told the DCNF.

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Pew Report: Expect Increase in Debt Collection Lawsuits, Debt Collectors Seizing Stimulus Checks

A new report published by Pew Charitable Trusts suggests that with the increase of debt collection lawsuits, “debt collectors may seize $1,200 coronavirus checks intended for household expenses.”

Before the coronavirus restrictions began, American household debt had already increased by $1.5 trillion between 2008 and 2019. As debt increased, so also did an aggressive approach made by creditors and third-party firms to use state civil courts to pursue collections through debt claims, Pew says.

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U.S. Constitution Does Not Guarantee That You Can Always Pay With Cash

In its Article I, Section 8, Clause 5, the United States Constitution provides:  “The Congress shall have Power…To coin Money, [and] regulate the Value thereof….” And since the Constitution’s drafting in the year 1787, cash has played a vital role in the nation’s economy as the generally-accepted medium of exchange.  Barter still exists, but on a relatively limited basis and, although there has been chatter for decades about America one day becoming a completely “cashless” society, that day has yet to arrive. In modern times, there are, of course, multiple methods of payment for goods and services as well as to pay down debt in installments — or to completely extinguish it in one fell swoop.  In addition to cash, there are checks, credit cards, electronic money transfers and other means of payment. Pursuant to the above-quoted provision from the U.S. Constitution, Congress enacted the Coinage Act of 1965 (last amended by two bills approved by the 97th Congress in Public Laws Nos. 97-258 and 97-452; the 1965 Act is the successor to the Coinage Act of 1792 as well as the Coinage Act of 1873).  The 1965 version includes Title 31 United States Code Subchapter 5103 which, from 1983…

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