Consumers admit to using credit cards to cover monthly expenses

ORLANDO, Florida. – Florida consumers struggling with the high price of everything from gas to food should consider a new budget mantra: “Is it a need or a want?” »

That’s the latest advice from seasoned investment specialists who see a new trend in the economics of inflation in 2022.

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Seasoned financial planner Nancy Hecht told News 6 that the cost of living is on an upward trend thanks in part to the Federal Reserve’s rate hike strategy.

“We are looking at (at a minimum) two more interest rate hikes, which means everything is going to go up again,” Hecht said this week. “I guarantee you that in six months everything will cost more.”

This surge in consumer prices may explain the results of a recent survey which found that more than half of the 1,200 respondents admitted to using credit cards to cover their monthly expenses.

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Hecht has long advised against the use of a credit card unless the consumer is able to “pay the bill” each month.

Otherwise, “credit card purchases should not be made unless you have no other choice,” Hecht told News 6.

Matt Schulz, chief credit analyst for Lending Tree, said consumers face a mismatch between after-tax income, emergency savings and monthly bills.

According to Lending Tree, for many with a salary of $35,000 or less, there may be no choice but a credit card.

“Inflation has changed their financial margin of error,” Schulz told News 6. “A zero percent balance transfer can be extremely helpful.”

According to Schulz, consumers might also consider a low-interest loan to consolidate debt and reduce interest.

Schulz, who worked as a financial advisor for years, said consumers never think about asking their credit card company for a lower rate.

“70% of people who ask for this (lower rate) get what they want,” he said. “That surprises a lot of people, but far too few people ask.”

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Hecht and Schulz advise every consumer to prepare an overview of their personal expenses for monthly and annual bills.

Hecht, a longtime financial advisor with Certified Financial Group, has put together a personal spending summary sheet for News 6 viewers so they can take a good look at their expenses and budget within their means.

“You have to look at your lifestyle,” Hecht said. “When it comes to shopping, you have to be judicious in your choices, make a complete shopping list.

Hecht said the personal budget sheet covers everything from mortgage and rent to communications, pets and personal care. You can access this document at the bottom of this story.

She admits to using store-bought hair color to supplement visits to her hairdresser and looking at labels to make sure she’s getting the best price per item.

If you would like additional financial advice, email Nancy Hecht at [email protected]

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For a complete overview of LendingTree’s consumer survey, Click here.

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