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Your 60-second money minute. Today's topic: Personal Loans For Credit Card Debt
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Your Money Minute — Personal Loans For Credit Card Debt 3/5/26. Machine-transcribed; use the interactive transcript above to jump the player to any line.
with a CNBC your money minute. I'm Jessica Edinger. Have you ever taken out a personal loan? More and more people are as Americans are the deepest in credit card debt they've ever been. Consumer spending has remained strong, even as overall household debt levels. Have risen US credit card balances reached a record of 1.28 trillion at the end of 2025. That's according to the New York Fed. That's CNBC's Joe Kernan with the data. Now with the most credit card debt in US history, CNBC's Sharon Eperson says people are trying to dig out by taking those personal loans. She has data from credit reporting agency trans union. Personal loans will be the primary driver of consumer credit growth in 2026 with loan originations outpacing the growth in the number of new mortgages through refinancing or purchasing and credit cards. But Eperson notes that many people are still paying pretty high interest on those personal loans.
The rates there are not that much lower than the credit card rates that they're paying. You know, even though the average personal loan rate is 12%, if you're talking about a subprime bar where they're probably paying above 20% for sure for a personal loan, 20% interest on a personal loan. And yes, the old credit card debt gets paid off, but it kind of doesn't matter when that person just starts spending again. Once you have that personal loan and you're paying off the credit card, you don't use that credit card anymore. That's the issue. People need to understand that there is free help available with nonprofit credit counseling agencies that can help people figure out how to get out of this cycle. There's a lot more on this at CNBC.com. I'm Jessica Edinger, CNBC.
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