Embarrassed Americans underreport credit card debt by $415 billion

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By Erin El Issa

It’s not uncommon to fudge some of life’s most sensitive numbers, such as age or weight.
But according to a NerdWallet study, consumers aren’t just fibbing a little when it comes to their credit card balances. In fact, government data show them reporting a total of $415 billion less than they actually owe.
As of December 2013, lenders reported about $683 billion in outstanding credit card debt, according to the Federal Reserve Bank of New York. Borrowers, on the other hand, reported only about $268 billion when asked for the Federal Reserve’s 2013Survey of Consumer Finances. This disparity was greater for credit card debt than any other type of debt, including student loans and mortgage debt.

When NerdWallet dug into the reasons behind this reporting difference, it found that the stigma surrounding credit card debt may be a leading cause of underreporting.
The stigma of credit card debt
Part of the $415 billion discrepancy can be explained by unintentional underreporting on the part of consumers. They may not know how much debt they have, or they might not be reporting debt they’re planning to pay off in the near future. But based on NerdWallet’s survey results and the significance of the disparity, it seems likely that a large portion of this underreporting is intentional because of the stigma credit card debt carries.
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