Arrow-right Camera
The Spokesman-Review Newspaper

The Spokesman-Review Newspaper The Spokesman-Review

Spokane, Washington  Est. May 19, 1883
Cloudy 29° Cloudy
News >  Business

More Americans are stuck with long-term credit-card debt

Sept. 19, 2022 Updated Mon., Sept. 19, 2022 at 8:47 p.m.

Mastercard chip credit cards.  (Andrew Harrer/Bloomberg)
Mastercard chip credit cards. (Andrew Harrer/Bloomberg)
By Alex Tanzi Bloomberg


More U.S. consumers are saddled with credit-card debts for longer periods of time, according to a survey, struggling to pay down amid high inflation and rising interest rates.

Sixty percent of credit-card debtors say they have been in credit-card debt for at least a year, up from 50% a year ago, said in a report Monday. The share of those who have been in debt for over two years also increased, to 40% from 32%, according to the online credit-card marketplace.

With inflation exceeding wage gains, more households have relied on revolving debt. Consumers in their 20s and 30s, and those in the lowest income brackets are more likely to carry a balance to cover daily expenses, such as groceries, child care or utilities than older generations, the report shows.

Although total credit-card balances remain slightly lower than before the pandemic, decades-high inflation has taken a toll on the precarious finances of many U.S. households.

About a quarter of respondents said day-to-day expenses are the primary reason they carry a balance. Almost half cite an emergency or unexpected expense, including medical bills and home or car repair.

The Federal Reserve is likely to raise interest rates for the fifth time this year next week. Credit-card rates are typically directly tied to the Fed Funds rate, and their increase along with a softening economy may lead to higher delinquencies.

Total consumer debt rose $23.8 billion in July to a record $4.64 trillion, according to data from the Federal Reserve.

The Fed figures include credit-card debt, student loans, and auto loans, but do not factor in mortgage debt. Revolving credit fell sharply at the onset of the pandemic, when business and activity restrictions limited opportunities to spend, but has soared back to a record level as consumers started spending again.

The Spokesman-Review Newspaper

Local journalism is essential.

Give directly to The Spokesman-Review's Northwest Passages community forums series -- which helps to offset the costs of several reporter and editor positions at the newspaper -- by using the easy options below. Gifts processed in this system are not tax deductible, but are predominately used to help meet the local financial requirements needed to receive national matching-grant funds.

Active Person

Subscribe now to get breaking news alerts in your email inbox

Get breaking news delivered to your inbox as it happens.