Many people would be surprised to hear that total credit card debt in the United States is actually going down during the COVID-19 pandemic. In fact, the total amount of consumer debt, which is primarily made up of credit cards dipped below $1 trillion in America for the first time since 2011. This is according to a report done by the Federal Reserve.

Considering the fact that so many people are out of work, one would think that people might be using credit cards to pay for bills and other basic expenses. However, the data indicates that many people are avoiding overspending on their credit cards now due to the pandemic.  

It could be seen as a positive that many people are acting more responsibly during the pandemic. After all, the massive unemployment problems are difficult enough for the nation to deal with. If people are avoiding taking on additional debt, then this is a great thing.  

However, part of the reason why people have been able to put off increasing their consumer debt is likely due to the stimulus payments. The government is currently in the process of preparing a new stimulus bill and president Trump has put out executive orders which guarantee $400 a week payments for people still struggling with unemployment during the pandemic.  

So, now that unemployed people will be receiving $400 instead of $600 per month, many more people could be forced to use their credit cards to pay for living expenses. For now, total consumer debt is still decreasing, but this trend could change very quickly.  

If you are struggling to pay your bills during COVID-19, then you should do what you can to avoid having to use your credit cards to pay your bills. Credit cards often have very high interest rates, and whatever you spend with them will have to be paid back, plus all the interest.  

You should only use your credit cards as a last resort. Instead, try to earn extra income, reduce your expenses, or even sell household items if you have to in order to pay your bills. Even if you never lost your employment, or if you just got your job back, you should still try to keep your expenses as low as possible. It is unclear how long the pandemic will last and exactly how much more financial hardship it will create.