newjerseynewsroom.com

BY BOB HOLT

NEWJERSEYNEWSROOM.COM

Federal Reserve reports say that consumers borrowed $20.4 billion this past November, raising consumer debt to a total of $2.48 trillion, the highest total in a decade.

Even worse is student loan debt, which is close to $1 trillion, and grew higher than credit-card debt in 2010.

Howard Dvorkin of ConsolidatedCredit.Org believed consumer spending increases were due to Black Friday and Cyber Monday. He said, “Consumers turned to credit for purchases they couldn't otherwise afford. As the bills begin to roll in, consumers may find themselves unable to pay them off."

Federal Reserve reports showed that consumer credit rose by an annual rate of 7.5 percent in the fourth quarter, according to the New York Post. Revolving credit, or credit card bills, increased by 4.5 percent, while non-revolving credit, involving such education loans, went up by 9 percent in December.

And according to the Los Angeles Times, average student loans for 2010 college graduates were $25,250. That marked a 5.2 percent increase from the 2009 graduates’ total of $24,000.

The average student loan debt of 2010 college graduates topped $25,000 — the first time it has exceeded that inglorious mark. Graduating seniors had an average loan burden of $25,250, up 5.2 percent from the $24,000 owed by the class of 2009

To pare down your credit card numbers, Consolidated Credit suggests paying off the higher interest rate bills first, paying more than the minimum where possible, paying on time, and avoiding new debts.

The National Association of Consumer Bankruptcy Attorneys wants to see Congress pass legislation to change the bankruptcy codes and allow graduates to discharge loans from private lenders.

“It’s strange that credit cards are dischargeable when private student loans aren’t,” Mark Kantrowitz, a financial aid expert, said to Time. “They should be treated the same.”