Americans are known for being big spenders…sometimes, too big. With an average household credit card balance of more than $8,700, many people now cannot keep up with the payments on their debt. In a nationally representative survey conducted by WalletHub, over 18 percent of respondents said they believe they will miss at least one credit card due date in 2020. That works out to about 46 million Americans.
Missing a credit card payment can start a chain reaction of negative events. First off, there are late fees of up to $29 for a first offence and $40 for another within six months. In addition, cardholders not already carrying a balance between months will lose their grace period, and interest will start accruing immediately on both new purchases and the unpaid balance. There might also be a high penalty APR on new purchases, depending on the issuer, and this rate can be applied to all balances after the cardholder is 60-days past-due on payment. Lastly, if the credit card issuer reports a late payment to the credit bureaus after it’s 30 days late, it will cause damage to the cardholder’s credit score. This can lead to higher costs and fewer borrowing opportunities in the future.
Missing a credit card payment is dangerous, but its negative effects can sometimes be quickly countered. WalletHub’s survey found that nearly 9 of 10 people who tried to get a late fee waived in the past were successful.
Below are some more of highlights of WalletHub’s survey, along with additional insight from a panel of experts.
- Credit card issuers are forgiving…if you ask nicely. Nearly 9 in 10 people who have tried to get a credit card late fee waived were successful. Women are 18 percent more likely to have tried to get a fee waived than men but are also 2 percent less likely to have been successful.
- Payment priorities change with age. People aged 18 to 44 are most worried about missing credit card payments. The 45-59 demographic is most concerned about their mortgage, while those over 59 put tax payments as their biggest worry.
- Luxury can lead to lapses. People with high income are almost twice as likely to miss a payment due to forgetfulness as people with low income.
- Men and women react differently to fees. When asked about their attitudes toward getting a late fee, women are 39% more likely than men to feel “punished.” Men are twice as likely to feel “indifferent.”
People miss due dates for bills sometimes, whether due to forgetfulness, lack of funds or some other reason. It may seem like a simple fact of life, but there’s often a lot more to the story, including far-reaching implications for all of our wallets. To gain further insight on missed payments and the late fees that can come with them, we posed the following questions to a panel of experts. Click on the experts’ profiles to read their bios and responses.
- WalletHub’s survey found that over 18 percent of adults say they will miss at least one credit card due date in 2020; what does that tell you, and would you expect the figure to be higher or lower?
- Do you have any tips for people who are worried about potentially missing credit card due dates?
- Does it surprise you that nearly 9 in 10 people who have tried to get a credit card late fee waived have been successful at least once?
- Why do you think 2.4 times more people are worried about missing a credit card payment than an electricity payment this winter?
- Why do you think people who earn at least $100,000 per year are nearly twice as likely to miss a payment due to forgetfulness than people who make less than $25,000 per year?
Ask the Experts
WalletHub conducted this nationally representative survey with over 700 respondents from 1/6/20 to 1/10/20. We weighted the statistical results to correct for demographic discrepancies. The margin of error for the total respondents is plus or minus 4.00 percent at a confidence level of 95%.
Full Details Overall
|Why would you most likely miss a credit card payment?|
|Don't have enough money||30%|
|No late fees||9%|
|Do you think you will miss at least 1 credit card due date in 2020?|
|What do you worry about missing the most?|
|Credit card payment||29%|
|Auto loan payment||10%|
|How would being charged a late fee on your credit card make you feel?|
|Have you ever tried to get a credit card late fee waived?|
|Were you successful?|
|Do you consider late fees when choosing a credit card?|
Note: Percentages may not total 100% due to rounding.