U.S. households paid down $28.6 billion in credit card debt during the first quarter of 2016, which represented the smallest Q1 debt reduction since 2008, CardHub reported.
The company, which offers comparisons of various credit cards, reported that skimpy paydown amount followed a year during which some $71 billion in debt was added to cards. That means households paid off just 38% of the amount they added to cards in 2015.
CardHub is now projecting those U.S. households will end the year with about $1 trillion in outstanding balances – the highest ever. That projection would bring the amount owed by the average indebted household to more than $8,500.
CardHub reported the average indebted household balance reached $7,597 – a 6% increase compared to the first quarter of 2015. The service said that is just $831 below the tipping point it estimates as unsustainable.
The company warned results from the first quarter of the year were greatly similar to results from the first quarter of 2007, including the paydown amount and its size relative to the previous quarter's build-up.
“That is not good news for consumers, considering the financial turmoil that followed the last time around,” the company concluded.
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