Interactive: What Interest Rate Are People Paying On Their Credit Cards?

Answer:  Lots of different interest rates…

From (if you go to the link, there is a interactive with a slider bar that allows you to see how the distribution of interest rates has changed from 2001-2013):

Screen Shot 2015-08-18 at 6.40.13 PM

Ask students to provide several takeaways in analyzing this chart. which might include…

  • Wide variation in interest rates on credit cards (from 0% to 30%).  Why?  Explain importance of credit scores.
  • Significant number (6 million) paying 0%.  Be sure to explain the concept of 0% APR.
  • Most paying between 8%-20%.
  • Large number are paying 22-30%.  Why do you think card companies charge these higher rates to consumers?