US credit card debt nears historic high as Americans struggle to keep up with spending

Americans' credit card debt reached $1,26 trillion in the second quarter of this year. It increased by $21 billion in three months, according to new data from the Federal Reserve Bank of New York, published on August 11, reports ABC News.

Total outstanding credit card debt is now just shy of the all-time high of $1,28 trillion set in the fourth quarter of last year.

High consumer spending typically leads to rising credit card debt. Economists cite rising prices, including for essential goods like groceries and gasoline, as one of the reasons.

On the subject: Three million Americans can't retire because they're still paying off student loans.

At the same time, many families are no longer able to make their credit card payments on time.

From mid-2022 to early 2026, the share of debt overdue by more than 90 days increased from 7,6% to 12,8%.

"Many families are living paycheck to paycheck, and it only takes one unexpected event to cause someone to fall behind on their mortgage payments," researchers at the Federal Reserve Bank of New York said during a call with reporters on Tuesday, August 11.

At the same time, the researchers noted that the increase in the share of overdue debts may be due not so much to the fact that people stopped paying for new purchases, but to the accumulation of old debts.

From April to June, Americans' debt on auto loans and home equity lines of credit increased, while student loan and mortgage debt decreased.

In total, American household debt is $18,8 trillion.

Auto loan debt reached a new all-time high of $1,71 trillion.

Distribution of US household debt by category:

• Mortgages: $13,12 trillion
• Auto loans: $1,71 trillion
• Student loans: $1,65 trillion
• Credit cards: $1,26 trillion
• Home equity lines of credit: $459 billion

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The Federal Reserve Bank of New York's report is based on an anonymized, nationally representative sample of data from Equifax credit reports (Equifax is one of three major U.S. companies, including Experian and TransUnion, that collect and process credit information about individuals. – Approx. Ed.)

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