Minimum wage boost can help with credit card debt

07.27.09
By James Conroy

Many Americans got a boost in their ability to pay off credit card debt Friday as the nation's minimum wage shot up 11 percent to $7.25 - a 70 cent increase over the previous amount.

While many states already require businesses to pay their employees at rates above the federal minimum wage, workers in 30 states will see an increase in their paycheck in the coming weeks as the new increase means a person earning minimum wage 40-hours per week will see an extra $28 each week.

Workers facing credit card debt may want to consider using this extra cash to pay down their credit card bills as the more than $100 per month they're likely to see may help them make more than the minimum payment.

Pay has steadily increased each year since Congress boosted the minimum wage in 2007 to $5.85 per hour. Last year workers saw their pay increase to $6.55.

In addition to helping those in credit card debt make additional payments, some economists feel the wage increase will also boost the nation's economy as workers have more money to spend on necessary items.

"That's what I'm thinking about in my head," Jamie Clark, a 24-year-old single mom in New Orleans told NPR. "I'm like, '$7.25? Now I can buy this.' It's just really embarrassing not to be able to provide those simple things."

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Americans making minimum wage will see an increase in their paychecks soon