The percentage of Americans who hold credit card debt has increased significantly in the last two years with higher income households more likely to have long-term debt of this kind.
A new survey from Bankrate.com reveals that 54 million Americans have held their credit card debt for at least one year, that’s 60% of the population in 2023 compared to 50% two years ago, but unchanged from a year ago.
The stats show that those households with an annual income of $100,000 or more are more likely than lower income households to have been in debt to their card provider for at least a year and for at least five years.
Among this wealthiest income bracket, 72% have held credit card debt for a year or more and 27% have held it for at least five years. For those households with an annual income below $50,000 the one-year figure falls to 53% and the five-year figure is just 13%.
However, lower income households are more likely to be carrying credit card debt at all – 53% among the $50K or less group, 48% of those in the $50,000-79,000 group, 44% in the $80,000-$99,999 group, and 38% for those above $100K.
Gen X (ages 43-58) and Gen Z (ages 18-26) cardholders are more likely (53% and 52% respectively) to carry a balance from month to month, compared to 49% of millennial (ages 27-42) cardholders and 41% of baby boomer (ages 59-77) cardholders. However, millennials are more likely to have held their credit card debt for at least one year.
Overall, almost half of respondents (47%) are carrying debt from month to month, slightly higher than in 2022 (46%) and up from 39% in 2021.
Bankrate’s senior industry analyst, Ted Rossman, says more people are carrying more debt and at higher interest rates.
“Credit card debt is easy to get into and hard to get out of,” Rossman said. “Contrary to popular belief, it’s usually very practical things that push people into debt. It’s so important to make credit card debt payoff a priority. If you only make minimum payments toward the average balance at the average interest rate, you’ll be in debt for nearly two decades.”
Rossman added that credit card rates are often three, four, or even five times higher than other common financial products.
Using artificial intelligence can have benefits for both advisors and their clients, according to new research.
Broker-dealers that sold the defunct securities backed by Inspired Healthcare generated more than $100 million in fees and commissions.
FINRA barred the advisor, Sung Moo Cho, last month.
A new MetLife survey finds real estate professionals are increasingly steering clients toward tax experts as rising property values leave more sellers facing significant capital gains.
The independent broker-dealer expands its business development bench with a new recruiter and an internal promotion in the West.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
