Stores empty? Maybe consumers are still living paycheck-to-paycheck

credit cardsby Dan Rafter

Wonder why so many shopping malls and retailers continue to struggle today? It might have something to do with the reduced buying power of consumers.

Too many consumers continue to live paycheck-to-paycheck. It makes it hard for them to spend big on home appliances, clothes or computers.

A new survey from the National Foundation for Credit Counseling illustrates just how much of a struggle finances have become for many consumers. According to the survey, one in five consumers would be unable to maintain their lifestyle if they couldn’t fund at least part of it with credit cards.

This means that these consumers could not pay their bills, buy their groceries or fill up their cards if they couldn’t rely on their credit cards to help them do it.

An additional 22 percent of survey respondents said that they’d have to make significant lifestyle changes if they had to live on an all-cash basis.

The National Foundation for Credit Counseling says that too many consumers rely too much on their credit cards. The foundation said that in 2013, the average consumer who sought counseling from a foundation member had five or six credit cards with a total unsecured debt equal to half of their annual household income.

“It is a warning sign if a person is not able to manage his or her daily lifestyle without the use of credit cards,” said Gail Cunningham, spokesperson for the foundation. “This is a dangerous habit that could lead to serious financial distress.”

And when too many people can’t get by without the crutch of their credit cards? You can bet that plenty of retailers will be struggling to gain customers.

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