If you're struggling to pay off credit card debt, you are far from alone: One in three Americans have more credit card debt than savings both in 2023 and 2024, a Bankrate survey shows.
“Credit card and auto loan transitions into delinquency are still rising above pre-pandemic levels,” Wilbert van der Klaauw, economic research advisor at the New York Fed, said in a news release earlier this month. “This signals increased financial stress, especially among younger and lower-income households.”
Which is higher? Your credit card debt or emergency savings?
About 36% of U.S. adults reported having more credit card debt than money in an emergencysavings account, a recent Bankrate survey found.
The amount of credit card debt versus emergency savings varies by generation. Millennials and Gen Xers are more likely than other generations to have more credit card debt than emergency savings at their disposal.
“Recognizing that the cost of carrying debt has increased significantly in the past two years and the insufficient level of emergency savings, more Americans are focusing on both paying down debt and boosting emergency savings simultaneously, rather than one to the exclusion of the other,” Bankrate Chief Financial Analyst Greg McBride said in a statement.
No matter the financial situation, 36% of Americans said they are prioritizing both paying down debt and increasing emergency savings, according to the survey.
Credit card balances increased by about $50 billion, or 4.6%, in the fourth quarter of 2023.
Credit card delinquencies, the amount of time in which cardholders fall behind in making payments, also increased.
The U.S. economy is overall steady, New York Fed researchers said, but areas exist in whichAmericans are overextended. Higher prices forfood, gas and housingcontribute to credit card debt.
Generation X has the largest credit card balances of all generations. Although each generation experienced an increase in debt between 2021 and 2022, the silent generation added the least amount, according to Bankrate.
Here's the average credit card debt owed by each generation, according to Bankrate:
Generation X has an average of $8,134 in credit card debt
Baby boomers have an average of $6,245 in credit card debt
Millennials have an average of $5,649 in credit card debt
The Silent generation (born between 1928-1946) has an average of $3,316 in credit card debt
Generation Z has an average $2,854 in credit card debt
How much credit card debt do Americans have? Americans' total credit card balance is $1.115 trillion in the first quarter of 2024, according to the latest consumer debt data from the Federal Reserve Bank of New York.
36% of U.S. adults have more credit card debt than emergency savings. 36% of U.S. adults are prioritizing both debt repayment and building emergency savings, as opposed to just focusing on one.
The average balance per consumer as of January 2024, however, was $11,989, indicating that many people who have one unsecured personal loan have at least one more. That's higher than the level recorded per consumer in January 2024, which was $11,968.
Americans collectively owe over $1 trillion in credit card debt. But one generation carries the most, on average: Gen X. The average credit card balance for Gen Xers, defined at those between the ages of 43 and 58, rose to $9,123 in the third quarter of 2023, according to Experian's latest available data.
Debt held by the public is projected to grow to $25,910 billion (98.4 percent of GDP) at the end of 2023 and $27,783 billion (102.0 percent of GDP) at the end of 2024.
According to the most recent delinquency data from the Fed, the 30-day delinquency rate (or the percentage of total outstanding credit card balances currently at least 30 days overdue) rose from 3.08% in the fourth quarter of 2023 to 3.16% in the first quarter of 2024.
Around 23% of Americans are debt free, according to the most recent data available from the Federal Reserve. That figure factors in every type of debt, from credit card balances and student loans to mortgages, car loans and more.
In total, other territories hold about $7.4 trillion in U.S. debt. Japan owns the most at $1.1 trillion, followed by China, with $859 billion, and the United Kingdom at $668 billion.
How much credit card debt the average American has (and how to pay it off) The average American household now owes $7,951 in credit card debt, according to the most recent data available from the Federal Reserve Bank of New York and the U.S. Census Bureau.
A record $8.9 trillion of government debt will mature over the next year, see the first chart below. The government budget deficit in 2024 will be $1.4 trillion according to the CBO, and the Fed has been running down its balance sheet by $60 billion per month.
The list of 31 billionaires worth more than Uncle Sam's cash total includes household names like Michael Dell, legendary investor Warren Buffett and Facebook co-founder Mark Zuckerberg, as well as billionaires with lower profiles such as French billionaire Francois Pinault and Chanel chairman Alain Wertheimer.
A staggering 242.7 million U.S. adults had debit cards in 2021, according to credit and debit card statistics collected by The Motley Fool Ascent. That's 93% of U.S. adults. Credit cards are also common, as 214 million U.S. adults (82%) had one or more in 2022.
How Many Americans Use Credit Cards? According to the Federal Reserve, 82% of U.S. adults had a credit card in 2022. About 73% of Americans have a credit card by age 25, making credit cards the most common first credit experience for young adults.
A November 2023 Bankrate survey of 2,350 U.S adults finds that 49 percent of cardholders carried credit card debt from month to month, up from 39 percent in 2021.
U.S. credit card debt. The higher cost of everything from housing to high-tops to haircuts are a major culprit. Although inflation has moderated since it peaked in June 2022, Americans—particularly lower-income families—are relying more on credit cards to cope with the sticker shock.
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