Credit Card Debt Study: Trends & Insights

Mar 11, 2019  |  Alina Comoreanu, Senior Researcher

Credit card debt statistics speak to the financial health of American households. They can also foreshadow over-borrowing bubbles, changes to lending standards, and other trends with the potential to impact our wallets.

We started 2018 owing more than $1 trillion in credit card debt. We ended it $67 billion deeper in the hole after an expensive second half of the year. Things began on an encouraging note, as Americans repaid $40.8 billion in credit card debt during Q1 2018 – the second-largest quarterly payoff ever and an apparent turning point in consumers’ addiction to overspending. But we added almost $108 billion in credit card debt back to our tab over the next three quarters instead, putting household finances on a decidedly more negative track heading into 2019.

So it’s not a question of whether consumers are weakening financially. It’s a matter of how long our overdependence on credit card debt will last and just how bad it will get. Below, you can learn more about the current debt environment, including which cities owe the most and how that changed during 2018, according to the latest data available from TransUnion and the Federal Reserve.

Main Findings

Outstanding credit card debt is at the highest point since the end of 2008, after reaching an all-time record high for a fourth quarter in Q4 2018.

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We ended 2018 with $66.7 billion in new credit card debt, and WalletHub projects a $60 billion increase in 2019.

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The $58.1 billion in credit card debt added during Q4 2018 is 35% higher than the post-Great Recession average for a fourth quarter.

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Since the end of the Great Recession, consumer performance has regressed on a year-over-year basis in 6 of every 10 quarters.

At 3.57% for Q4 2018, the charge-off rate is up nearly 2% year over year.

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Average Credit Card Debt per Household

Stat 2018 2017 Percent
Change
Average Credit Card Debt per Household $8,788 $8,557 3%
Total Credit Card Debt $1.034T $1.003T 3%
Annual Net Increase $67B $87B -24%

 

The average household’s balance, at $8,788, is $327 over being sustainable.

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2018 Credit Card Debt by City

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*99th Percentile = Biggest Paydown
1st Percentile = Biggest Increase