Credit counseling demand surges in 2024, with these states hardest-hit
Piper Sandler chief global strategist Nancy Lazar unpacks the state of hardworking Americans under record inflation on Making Money.
Credit counselors reported a significant surge in demand for financial counseling services so far this year, warning that the trend signals an increase in financial distress among U.S. consumers.
Credit counseling nonprofit Money Management International (MMI) recently released data from its mid-year analysis, which found a 52% rise in new clients in the first half of 2024 compared to the same period last year – with new clients carrying average unsecured debt of $28,000, an increase of 9% from 2023.
Kate Bulger, vice president of business development for MMI, told FOX Business the organization is seeing both an increase in the number of consumers who need help and in the amount of debt that they are carrying.
Rising consumer debt is driving an increase in demand for credit counseling, MMI warns. (Robert Nickelsberg/Getty Images / Getty Images)
«These are folks who were doing fine just a few years ago, but when inflation started to rise, they used their credit cards to bridge the difference between their income and their expenses,» Bulger said. «As their credit card balances grew, the minimum payment put increasing pressure on their budget. The situation quickly becomes unsustainable.»
PARENTS WILLING TO GO INTO DEBT FOR BACK-TO-SCHOOL SPENDING
Here are the states with the highest increase in demand for credit counseling so far this year, according to MMI:
Seattle, Washington, aerial view. The Evergreen State has seen the highest increase in credit counseling demand in the U.S. for the first half of 2024. (iStock / iStock)
The state of Washington topped the list with a 60% increase in
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