Military service personnel, including those in Outagamie, Wisconsin, risk their lives to serve and protect our country. During deployment, however, these military personnel are at risk of accumulating credit card debt.
According to a new survey conducted by the FINRA Foundation Military Financial Capability, military service personnel, especially the younger ones, might accumulate credit card debt with mounting interest rates and fees. With the nature of the military personnel’s work and pay schedule, they often make the minimum payments when they are deployed. When they return home, however, these servicemen face interest charges, late fee penalties and cash advance fees.
According to the survey, only 49 percent of military service personnel are able to pay their credit card balances in full per month while the rest have outstanding balances. Of these, 57 percent of the troops have a balance with high interest rates.
Military service personnel are protected by the Military Lending Act when it comes to short-term lending. However, the law does not protect them from high interest rates and charges on credit cards, which often results in credit card debt and financial challenges.
Credit card debt has been a problem for many Americans since the economy went into a recession several years ago. Although credit cards are convenient for the cardholders, they can potentially result in a financial disaster if the debtor is unable to pay the balance in full and on time.
Considering how risky it is for military personnel to use credit cards, something may need to be done to protect not only the service personnel but also Wisconsin residents from high-interest credit cards and finance charges. It may be essential for debtors to remember that they can eliminate their credit card debt through bankruptcy. Bankruptcy is not always a bad thing. In some cases, it is a solution to a very serious problem.
Source: LowCards.com, “Service Personnel Have High Risk of Credit Card Debt,” John Oldshue, Dec. 18, 2013