Atlantans carrying fewer credit cards, but have the highest average balance in the country
The average Atlanta-area consumer has 3.06 open credit card accounts, compared to 4.16 in 2007, according to recent report released by the credit score bureau, Experian.
That doesn’t necessarily mean locals are in the clear, because while the number of cards has gone down, the utilization of cards is higher than it was three years ago, said Michele Raneri, senior director of analytics for Experian.
“Utilization on cards is 33 percent compared to 31 percent in 2007,” she said. “The number of cards have dropped, but that has a tendency to make the utilization go up a little bit. If you close one card, you might use another one a little bit more.”
And the more you use, the higher the balances in many cases.
Experian compared credit card trends, including home equity lines of credit, across 20 metropolitan areas:
- Atlanta leads all major cities with an average balance of $6,753 on revolving accounts.
- Atlanta’s average balance in 2007 was $7,114.
- Credit scores in Georgia have not caught up to the national average. The average Georgian’s VantageScore, used by Experian, is 723 or a “C” score. The average TransUnion Transrisk score of 663 is five points lower than the national average.
The lower scores indicate that while Georgians may be using fewer cards, they are using cards frequently.
Ken Lin, CEO of CreditKarma.com said that consumers using their service most of last year pulled back and focused strictly on paying down debt. However, more are putting their cards into use rather than risk lowering their scores due to inactivity. Of their users from Georgia, there is an average credit card debt of $7,749, according to their July U.S. Credit Score Climate Report.
“Over the last six months, we’ve seen more consumers are pulling out their credit cards,” Lin said. “That is a trend that will continue to hold.”
The latest Federal Reserve Credit Report showed that revolving debt nationally dropped $4.5 billion for June and has declined $150 billion since October 2008. Contributing to the decline were credit card companies that tightened credit limits, canceled accounts, did away with bad loans and made it harder to get credit, said Bill Hardekopf, CEO of LowCards.com and author of The Credit Card Guidebook.
Consumers can do a lot to repair their scores, Raneri said, like making on-time payments, being aware of how much debt you have before you take on more and not closing accounts haphazardly.
“They shouldn’t close accounts unless they need to,” she said.
Have you made a dent in reducing your credit card debt? Are you using fewer cards?
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70 comments Add your comment
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August 16th, 2010
7:46 am
[...] rates rising News.gov.hk Atlantans carrying fewer credit cards, but have the highest average balance in … Atlanta Journal Constitution (blog) The Money Times -Healthy Financial Habits all 24 [...]
Jack Booted Thug
August 16th, 2010
8:08 am
LOL…thats funny!!
AngryVoter
August 16th, 2010
8:29 am
You should let your readers know that Vantage Score is different than the FICO score. Most people are aware of the FICO scoring system and will be confused by the Vantage Score.
The Vantage scoring system works like school grades multiplied by ten. 90 and above is an “A” and 80 and above is a “B” and so on. Under the FICO scoring system, anything above a 720 is generally considered good, while under the Vantage Score, it’s considered not all that great.
Take it Back
August 16th, 2010
8:38 am
As bad as the economy is, people should try to pay off all credit cards and then charge only as much as they can pay off when the balance is due. Of course, I realize that this isn’t possible for some folks.
Needs vs wants
August 16th, 2010
8:52 am
These are tough times and I don’t begrudge anyone for paying their bills by credit card if that
is the only way they can do it. From what I’ve seen, most credit card debt is related to lifestyle choices. In other words, lots of people spend on “wants” and not legitimate “needs”. The silver lining in the current economic troubles is that many folks are finally understanding that a LOT of what we spend our money on can be eliminated. Work hard, save your money, and live well within your means and you won’t be another sad statistic.
Bob LeBlah
August 16th, 2010
8:57 am
“Take it Back” how is it not possible for people to pay back their credit card balances every month? If they can’t afford it (pay for it) they shouldn’t buy it.
shell
August 16th, 2010
9:02 am
This proves my point. I keep telling people that Atlanta has become a debt trap. That’s why there’s so much identity theft here. The wages don’t keep up with the lifestyle so frequently promoted by the social life.
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August 16th, 2010
9:04 am
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Jef
August 16th, 2010
9:04 am
Not just a sign of Atlanta’s bad economy, but a sign of our poor education as well. Someday they’ll realize teaching personal finance in high school is a must. People I know going into debt for silly things and being so nonchalant about it flat out scares me.
The whole story
August 16th, 2010
9:16 am
And TransUnion also fails to tell you that their “Three-in-One Score” product is shamelessly inaccurate. I purchased the 3-in-1 report because I wanted my TransUnion score and there was no way to buy it without a subscription or a multi product – a fact that should be reported in and of itself. When I downloaded the report TransUnion reported by “Equifax Score” (not FICO) was 50 points lower than what I new my FICO to be. It should be illegal to knowingly sell a 3-in-1 report (or “Score” to be more specific) that is wrong. If I knew who I could report it to, I would. But since the credit bureaus report to no one and are accountable to no one, I just have to accept this intentional dishonesty.
I do wish the AJC and other mainstream media would stop treating the credit bureaus with kid gloves. I’m not saying credit reporting isn’t needed, I’m saying it shouldn’t be such a mystery as to how they arrive at scores.
Diddy
August 16th, 2010
9:26 am
It’s ironic because Atlanta has one of the lowest cost of living among large metro cities.
The “A” Has A Major Problems With The Big “C” | Blackinformant.com
August 16th, 2010
9:35 am
[...] “C” for “Credit”. [...]
Base
August 16th, 2010
9:43 am
Low wages=high unemployment
Bunnie
August 16th, 2010
9:43 am
Diddy, Atlanta’s lower cost of living is a joke. No one takes into consideration the high cost of transportation. In other cities like NYC public transportation costs maybe $100 per month and that’s it, more if you want to take cabs everywhere. In ATL you need a car, forget that “live intown” crap. You need a newer car because you don’t want the risk of breaking down and getting hit by some jerk on his cell phone. Then gas prices are crazy intown, lower if you live OTP but it takes more to get intown where many of the jobs are. Then there’s insurance and the kicker, the ad valorem tax on your vehicle. I went from spending less than 1/20th of my monthly income on transportation to spending nearly 1/3rd.
The Truth
August 16th, 2010
9:50 am
Bunnie… Don’t forget state income tax! Georgia is not a tax friendly state, and we really don’t get that much in return, especially in transportation.
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August 16th, 2010
9:56 am
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Jack Booted Thug
August 16th, 2010
10:03 am
When it comes to credit cards most people are irresposible and stupid therefore Atlantas ratings are just a reflection of the irresponsible, corrupt and stupid society it has become.
We in The Burbs are much more intelligent.
SmartMoney
August 16th, 2010
10:05 am
My wife and I save 40% of our income via 401k’s, IRA’s and regular savings in the bank. We also give 10% off the top to our church and other charities. We could have brand new expensive cars, live in a luxury home, eat out regularly, and have season tickets to the Falcons and Braves. But being prepared in case one of us loses a job and having the money we want for retirement comes first. It’s called having priorities folks, and too many Americans have theirs all screwed up.
Bob LeBlah
August 16th, 2010
10:12 am
“keep telling people that Atlanta has become a debt trap. That’s why there’s so much identity theft here. The wages don’t keep up with the lifestyle so frequently promoted by the social life.”
What does the above even mean? What does identity theft have to do with people living a lifestyle they can’t afford. We’ve created a generation of retards. People who spend more than they have on non-necessities. You’ wouldn’t believe the number of people that believe a cell-phone or cable tv is a necessity.
Maybe a depression would do this country some good and wake up the useless sludge we have in our society that can’t even manage a bank account and understand that if you spend more than you bring in you can’t build wealth.
Bob LeBlah
August 16th, 2010
10:13 am
SmartMoney. Good job. Let’s form our own community.
college is forever
August 16th, 2010
10:15 am
http://www.collegelunchboxes.com If you take your lunch to work in the limited edition UGA classic tin lunchbox you can save some money to put towards those credit card balances. Check it out at most Kroger’s metro wide or on line. Go Dawgs!!!
Johnny Knoxville
August 16th, 2010
10:21 am
You can go to Lenox Mall on a Saturday night and figure out who is running up their credit card bills…know what I mean?
ExAtlantan
August 16th, 2010
10:21 am
Perhaps this is why people from Atlanta are so angry and judgemental!
chris
August 16th, 2010
10:22 am
Not to say that some of this credit card utlilization isn’t the product of tough economic times, but as a relative newcomer to this area, I can’t help but notice that Atlantans are some of the most materialistic people I’ve ever encountered. How many of those people you see driving BMWs, carrying Louis Vuitton bags, and talking on the latest iPhone can actually afford those items while paying their bills and saving money each month? Probably not that many. Sadly, for a lot of people image is everything.
Jef's friend
August 16th, 2010
10:24 am
Jef,
Do you waste your time railing against our schools often? Do you know what is happening in them, or just show off for your friends on blogs? Personal finance is 20% of the high school Economics course.
Jef said”Not just a sign of Atlanta’s bad economy, but a sign of our poor education as well. Someday they’ll realize teaching personal finance in high school is a must. “
ExAtlantan
August 16th, 2010
10:25 am
Chris, I still have family in the area and you hit the nail on the head! Suburbanites up there are sooo materialistic and phony, it is sickening!
Smart money lies
August 16th, 2010
10:27 am
Anyone can be a hero on the internet, looks like your mom’s basement worked out pretty good for you.
alexander
August 16th, 2010
10:28 am
narcissism is expensive
Out of Intown
August 16th, 2010
10:29 am
As far a the cost of living in ATL: Living inside the city is getting more expensive by the month: Water and sewer bills (last month: $126) are quadrupling and the sanitation bills ($422) are outrageous for the poor service you get and budget overruns on the new sewer lines and add to that a generally unresponsive city hall. I notice gas price higher IPT and I grocery shop with friends in Swanee and notice cheaper prices there. I think the glamor of living ITP of a few years ago during the real estate boom has fallen like a lead balloon and not sure the trend will resume when the great recession is done. And I have to wonder if most of the employment in the metro area is NOT in Atlanta proper but scattered in the suburban areas.
ncis7
August 16th, 2010
10:29 am
This report really does not surprise me. Atlanta is city about “show”, what you are driving, what labels you are wearing. This culture in Atlanta drives the credit card debt. I am not naive in believing this is the only contributing factor.
hdhd
August 16th, 2010
10:31 am
Suggesting that “teaching personal finance in highschool is a must” is to imply that someone at said highschool is qualified to teach such a subject.
Most young(ish) people in this country spend all of their paycheck every month. Yeah, they might have a nice house and nice cars and they can pay their bills. But what happens when they get older? When they are told they can retire? Will they will expect some magic bank account to appear and start paying them? Do they even know where money that retired people live on comes from? Oh, but they will have Social Security…..yeah, don’t hold your breath. Not only will the next generation have to pay the debt for the out of control spending our government has now, but they will have to “bail-out” all these people that have no idea how to save money.
ExAtlantan
August 16th, 2010
11:08 am
Oscar, what a perfect example of typical ATL resident!
ExAtlantan
August 16th, 2010
11:14 am
The narrow minded, right wing, self righteous conservatives can’t possibly do without what their neighbor has…
Bob LeBlah
August 16th, 2010
11:29 am
@ Smart money lies– Amazing. Managing your money well makes you a “HERO”. Thats the problem with society. If you do the simple things in life that should be natural you’re considered amazing. You can’t believe him b/c you’re one of those with $7k (or more) in cc debt.
Ellen
August 16th, 2010
11:32 am
Job loss and medical problems often lead to people using their credit cards more. It only takes one catastrophe to get people into credit card trouble….
Bob LeBlah
August 16th, 2010
11:39 am
Ellen, respectfully you’re right in some cases. However, the majority of time (much greater %) is people just living beyond their means. I think you’d find before the recession, that the numbers werent much better. And even if that were the case, that is a stupid way to handle things. Use a credit card to take out a 10% loan (at best) to cover yourself for 30 days when you know you arent going to be able to pay it off on time..
Ole Guy
August 16th, 2010
12:03 pm
There are many fine viewpoints expressed here…some appear to be a little right or left of center, but that’s ok. There is, however, one common thread to the financial difficulties toward which people seem to almost gravitate…PEOPLE ARE FREAKIN STOOPID (not simply stupid, but a special brand, reserved especially for those who insist on self-gratification at any cost).
A typical example will be found in almost any store with self-checkout lanes. These gentry who, in self-annointed importance, are in too much of a hurry to get in line with the rest of the bourgeois, simply fail to/do not care to recognize that use of these automated machines sends the message to management that one less unit of labor, in the form of a cashier, is needed.
Another outward sign of financial ineptness may be found at almost any gas station. One observes many making purchases of grossly overpriced items, all in the name of (lemme see, what’s that word which has become the hallmark of the slovenly nature of the American people…oh yea!) CONVENIENCE!.
The issue is not whether people conduct daily commerce by way of cash, credit, or debit. Any-and-all of these forms of exchange can have both positive as well as negative impacts on personal finance. The main issue is that PEOPLE ARE STOOPID! You cannot ascribe it to “needs more education”, unforseen circumstances beyond one’s realm of control, the so-called down-trodden, or any number of issues which we have invented as a way to psychologically hide from our responsibilities…PEOPLE ARE SIMPLY STOOPID!
JMG
August 16th, 2010
12:23 pm
I’ve made a commitment to get rid of my credit card debt. I’m living within my means and quickly shredding all offers for new credit cards. As Dave Ramsey says, becoming debt free is 10% know-how and 90% behavior.
Katie Leslie
August 16th, 2010
12:29 pm
Hey All
I’m Rana’s colleague and writing an article about this. If you have a story to share and will let me use your name, would love to hear from you at kleslie@ajc.com
JMG – are you in Ramsey’s FPU course?
Chris
August 16th, 2010
12:34 pm
Why do we blame the credit card companies? Why do we blame “the Jones’”?
Let’s blame the consumer’s inability to control themselves. Get a budget! I never use cash; I pay everything with a credit card (not a debit card). I pay the balance every month. Never pay interest. Never incur late fees.
Michael
August 16th, 2010
12:35 pm
Don’t worry Atlanta, keep spending! Obama will bail you out too!
shell
August 16th, 2010
12:51 pm
To Bob blah or whatever you call yourself: Identity theft is related to credit cards because we live in a credit society. You really can’t get the house, the car, or sometimes the job if you don’t have the credit. People still your identity to get the lifestyle they can’t afford, duh. I firmly believe this country puts too much emphasis on credit.
shell
August 16th, 2010
12:54 pm
sorry, ’steal’ your identity.
Craig - The real Criag
August 16th, 2010
1:00 pm
This explains a lot. My wife and I always wonder how so many people drive 60K Tahoes and Yukons. I was convinced that the city revolves around material things and people are willing to put themselves in debt for a long time to appear wealthy, viewpoint validated. My wife and I went to get a more appropriate family car and almost had to change my pants when I saw what a percentage of my monthly income would be a car/insurance payment for a large suv…needless to say we are still driving the same car.
StJ
August 16th, 2010
1:25 pm
They gotta have the bling…if it means borrowing, or identity theft/robbery/carjacking if no one will let them borrow. Some people have gone so far as to steal the identities of their own children, parents, or grandparents to satisfy their craving for bling.
These people are pathetic. Guard your wallets, people.
TRUTH
August 16th, 2010
1:40 pm
Precisely why there is a need for Wall Street Reform with teeth!! Stop credit cards going to college students, make it tougher to issue a credit card and eliminate the traps that the banks are allowed to set for consumers. Educated or not, banks thrive on the “fine print.” Wait a minute, imposing any style of reform on these leeches would “..Go against the will of the American people!!” (Preparing the battle cry of the Republican Party…). Its right there in front of you conservative, Tea Partying, Republicans, and knowing your response, it will be something that goes against the good of the people. That’s why Atlanta is in the news today for the high level of foreclosures. You can’t pay what you owe if you have no income. No job, no income. AND, its not the fault of the consumer. Its just rigged up against the middle class and for the benefit of the top 2 percent.
We need reform WITH TEETH!!
shell
August 16th, 2010
1:51 pm
Unfortunately, I know quite a few Atlantans with bad credit and they, as a result, are some of the biggest identity thieves. A lot of them believe, ‘well, I missed up my credit, so I go steal someone’s else. This is really an old news story. AOL posted the very same headline almost a year ago. Bob, we don’t live in a nation of retards, we live in a nation of people who have been lead into consumer ignorance. If we are really honest about this, we would ask ourselves is it really possible to live debt free in a society where everything is expensive. Check the price of TV’s and washers/dryers.
Tom
August 16th, 2010
1:57 pm
This like the housing crisis all over again. People bought houses they couldn’t afford, because they felt “entitled.” Then the economy crashed when suddenly everyone realized they had bitten off more than they could chew. Of course “society” was to blame — greedy bankers, corrupt politicians, etc.
So sad that people can’t learn lessons. Ample credit is available to many poor-risk consumers. Hey, why not buy a new car, a cool iPhone, and an awesome HDTV?
One could argue that the greedy bankers and corrupt politicians should put a stop to this. I prefer to think that Americans don’t need to be babysat by regulators. I know that I won’t engage in self-destructive behavior just because it’s easy to do. But, judging from the obesity reports, I think I’m in the minority. Sadly, maybe the left wing is right. Maybe the majority of Americans are too stupid to control their behavior, so we do need government to think for us and babysit us. Truly, truly sad.
Allyanaz
August 16th, 2010
2:02 pm
Paid them all off completely in 2008 and haven’t activated or used one since. I feel more free than I ever have in my life. When I was struggling and tried to negotiate all my credit cards, they banks were so nasty, I decided to give them every penny and never, ever give them another opportunity to make a penny from me again. Best thing I every did. Not only that, but it caused me to stop buying things I didn’t really need anyway. Lo and behold! I didn’t get that beautiful dress or shoes and I’m still alive!
sansho1
August 16th, 2010
2:21 pm
Allyanaz, I made the same decision you did, but in 1998. If my experience is any guide, in a few years you’ll be able to buy those nice clothes with good old interest-free cash, as 20% of your income won’t be going to finance your debt. Congratulations!