Chipping away at debt

A national survey indicates people have worked this year to reduce debt, and an Omaha credit counselor confirms that finding.

According to American Express’ July Spending & Saving Tracker, 75 percent of those surveyed said their debt hadn’t increased over the past six months, and 38 percent said their debt declined.

Sam Hohman, chief executive of Credit Advisors Foundation in Omaha, said her company has seen indicators that people are trying to be financially responsible and control debt.

“What we’re seeing are people who perhaps have been carrying large sums of debt for a very long time, and could continue to do that, who are changing there minds and coming to us. They are really resolute about taking care of their debt once and for all,” Hohman said.

The American Express survey questioned 2,004 adults about their spending and saving patterns and intentions midway through 2010 compared to the beginning of the year.

“It’s encouraging to see that consumers are continuing to balance their spending intentions while remaining committed to maintaining manageable debt levels,” Pamela Codispoti, a company spokeswoman, said in a press release.

She said people are taking a “measured approach” to their finances and are willing to spend for meaningful experiences such as dining out and traveling with friends and family members.

Hohman said that while the local economy is better than the national picture, consumers are aware of warning signs and want to reduce or eliminate their debt. There’s a lot less pressure to go out and spend a lot of money in order to keep up with the Joneses, she said.

Also, people are saving so they can purchase big-ticket items — a car, in one case of which Hohman was aware — with cash rather than buying on credit, she said. In the past, “people were willing to make payments even on the smallest of things,” Hohman said.

Contact the writer: 444-1074, john.keenan@owh.com

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