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Credit Card Debt Statistics

When you’re stressed out about credit card debt, it’s easy to feel like you’re the only one. Even though not many people talk about their credit card debt, it’s a common problem among many Americans—with 47% of U.S. adults carrying credit card debt. Credit card debt is the most common type of debt that we deal with at CreditAssociates. We’re on the phone nearly every day, negotiating with creditors to reduce the amount of debt our clients are required to pay back. You could even call us experts! 

Read on for a few pieces of info and stats on credit card debt.  

Types of Debt in America

Before we dive into stats, let’s go over types of debt. While there are many types of debt in America, there are three typical buckets that your debt could fall into.

Unsecured Debt

Unsecured debt is not backed by an asset, like with mortgage or auto loans. Credit cards, personal loans, and private student loans are all examples of unsecured debt—without collateral behind them, these types of debts often carry higher interest rates.

Secured Debt

Secured debt is when you have collateral behind the loan. Mortgages, auto loans, and leases are examples of this type of debt because they can be paid off through repossession or foreclosure on your property if you default (or miss payments).

Revolving Debt

Revolving debt is debt that you carry on a revolving line of credit, like a personal loan or credit card. With the example of a credit card, you can spend any amount below your limit but cannot go over unless you receive your credit card company’s approval. The debt isn’t for a set purchase or repayment period, so it’s  considered “revolving.”

Credit Card Debt Statistics

If you’re wondering how you stack up to others’ credit card debt load in the United States, check out these credit card debt statistics that could give you an idea of where you stand financially.

Average credit card debt in America: 2021

According to a study from ElitePersonalFinance, the average credit card debt in America is $5,315. 

Average credit card debt in America

According to data from the Federal Reserve’s Survey of Consumer Finances, U.S families’ average credit card debt is $6,270. In total, there is an estimated $807 billion in credit card debt, which makes up 5.6% of total debt in the U.S.

Average credit card debt by state

A study by Experian showed that states with the highest credit card balance in 2020 were Alaska ($6,617), Connecticut ($6,040), and Virginia ($5,992). The states whose residents have the lowest amount of credit card debt were Iowa ($4,289), Wisconsin ($4,376), and Kentucky ($4,521).

Average credit card debt by age

The Federal Reserve Survey of Consumer Finances found that credit card debt is typically highest for those between 45 and 54 years old, with an average credit card debt of $7,670. This study also showed that 47% of individuals younger than 35 are carrying debt.

Average credit card debt by income

While you might think that individuals with less income might have a higher average credit card debt, the Federal Reserve Survey of Consumer Finances found that those in the 90th–100th income percentile had the highest average credit card debt at $12,600, compared to $3,830 for those below the 20th percentile in income. 

Average credit card debt by credit score

According to an Experian study, the highest average credit card debt is seen among those with a good credit score between 670 and 739. People in that category were found to have an average credit card debt of $9,712. On the low end, people with poor credit scores ($3,446 in average credit card debt) and exceptional credit scores ($3,616 in average credit card debt) saw the least reliance on their credit cards.

Credit Trends in Changing Times

While the financial landscape is constantly changing, there are a couple of trends you might want to be aware of in 2021.

Contactless payments

 The contactless payment revolution has arrived, and it’s not just about the cards. With new technologies like Apple Pay® and Google Pay® coming onto the scene, credit cards may no longer be necessary to make purchases. While this can help make transactions easier, it’s important to research any potential fees that could come with these methods.

Importance of customer experience

Credit card companies that provide customers with the best experience will be rewarded for their efforts. It’s expected that credit cards and banks will become more transparent to build a better relationship with consumers. These companies also strive to retain as many customers as possible. So if you’re unhappy with your credit experience or current payment plan, your credit card company or bank might be open to renegotiating things like interest rates or payment periods.

‘Buy now, pay later’ will see massive growth

Being able to delay when you make payments for items you purchase will become more common in the future. Credit card companies are expected to offer this type of option, which is a trend that’s already gaining traction overseas. Consumers beware: Just like with credit cards, it can be easy to accumulate large amounts of debt this way. If you buy something through this method, make sure you have a plan to pay it off!

Data protection is vital

Data protection is a top priority for many consumers, so credit card companies are making changes to accommodate these preferences. Credit information should be encrypted and protected when it’s stored at any point during the customer experience. It’s also vital for consumers to protect their personal information when possible. Remember, never share any personal information via electronic messaging, including: banking info, credit card number, social security number, or driver’s license number.

Common Questions about Credit Card Debt: 

What percent of the population has credit card debt?

A study by creditcards.com found that 47% of adults have credit card debt, up 4% since a similar survey was conducted in March of 2020.

Is $15K in credit card debt bad?

It depends on your financial situation if that is considered too much. While it is above the national average for credit card debt, it might not be a bad thing as long as you can keep your debt-to-income ratio below 28%. However, if you feel like you’re carrying too much debt or are looking to reduce your monthly payments, debt relief might be a good option for you.

What is the ideal age to be debt-free?

In an interview with CNBC Make It, Shark Tank investor Kevin O’Leary said that the ideal age to have all your debt paid off is 45. His reasoning for this is that it is likely the halfway point of your career, and you will need the remaining 20 years to accrue capital that can help you live comfortably in retirement. However, debt management is not a one-size-fits-all concept. If you need help figuring out a plan to become debt-free, we recommend speaking with a certified debt professional.