Credit Cards ... SAFETY NET?

Credit Cards are Safety Net for Low-Income Americans
People earning low and middle-incomes are using credit cards as their safety net, paying for basic living expenses, medical bills, and other items with their cards and accruing more debt. According to a report released in July more than one-third of households said they used their credit cards for rent and mortgage payments, groceries, and utilities. For these households, the average credit card debt increased 3 percent from $9,536 to $9,827 in three years with 42 percent of survey respondents said they had more debt than three years ago.
For people aged 65 and older, credit card debt increased 26 percent, from $8,138 in 2005 to $10,235 in 2008, with medical costs being the main reason for the jump.
Even before the recession, households earning $50,000 a year were using credit cards as a safety net. Low and middle income earners are also more likely to be charged higher credit card rates - a quarter surveyed said they paid at least 20 percent interest on their credit card balances; a third of black and Hispanic households reported they were paying that percentage rate.
Source: FRAC, August 2009