Moody's Investors Service says the number of Americans who paid their credit cards bills on time reached a record high this June. Because of this, credit card delinquencies fell to their lowest level in four years.
Ted Fee, assistant professor of finance at the Eli Broad College of Business, says one of the reasons may be that Americans are being more careful with their finances. He also says because of low interest rates, people are able to pay off more of their debt than they had in the past.
In fact, the study also shows that people are making higher payments towards their credit card debt.
Fee says another possible reason for the lower numbers may be the credit card companies becoming more stringent on who gets approved for credit. They also may be tougher on individuals are have not met their minimum payments.
While he says this is a good sign that the economy may be turning around, it's not going to change drastically in the next few months so as to affect the presidential elections. However, he does say this is an indicator of holiday spending. He says when people feel secure with their finances, they are more apt to spend more, especially during the holidays.
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