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Credit Card Debt Statistics
by Mark Brinker
(updated February 2009)
- Record credit card delinquencies in January 2009. According to an article by Saskia Scholtes in the Financial Times online:
> Charge-off rates in January 2009 were 40% higher than a year ago at 7.5% and were expected to approach 9% during the second half of 2009.
> As one would expect, late payments on credit card bills are closely link to unemployment levels. Non-farm employment fell 524,000 in December 2008, contributing to the biggest decline in payrolls on a three-month moving average since 1945. The unemployment rate jumped to a 15-year high of 7.2%, from 6.8% in November 2008
> Many analysts are predicting financial conditions to worsen in the coming months.
For more information, here's the link to the complete article:
Credit Card Delinquencies Climb To Record Levels While Loan Write-Offs Soar
- Here are some interesting statistics from an article titled, “Don’t Get Clobbered By Credit Cards” by author and journalist, Gary Weiss:
> The average American household’s credit card debt in 1990 was $2,966. In 2007 it was $9,840.
> 60% of U.S. consumers always (or usually) pay off their bills in full each month. The 40% who don’t pay off their bills each month are called “revolvers”. In 2007, revolvers paid $18.1 billion in penalty fees to credit card companies. This figure is up more than 50% since 2003 and accounts for approximately half of the industry’s $40.7 billion in profits. For the full article, please click here.
(SOURCE: www.parade.com and garyweiss.blogspot.com)
- According to a study released by Bankrate, Inc. in February 2008:
> 66% of Americans say debt is often the result of unfortunate circumstances beyond a person's control, while 60% say it is usually the result of bad decisions.
> Americans have conflicting attitudes about debt. While 91% believe debt can be controlled by disciplined saving and spending, 72% also believe that debt is a part of modern life and difficult to avoid.
> 64% of the people polled who carry debt admitted that debt is a cause of worry for them. In addition, the study found that men worry less than women about the debt they carry.
(SOURCE: www.bankrate.com)
- In October 2007, credit card debt that was at least 30 days late totaled $17.6 billion, up 26% from October 2006. Some credit card companies, including Advanta, GE Money Bank and HSBC, are reporting a 50% increase in accounts that are at least 90 days late compared to the same time last year
(SOURCE: Rachel Konrad and Bob Porterfield, Associate Press Writers)
- U.S households will receive approximately 5.3 billion offers for new credit cards in 2007.
(SOURCE: Synovate, mailmonitor.synovate.com)
- UK Credit Card Debt Statistics (compiled 11-1-07)
> Approximately 24.5 million transactions worth $2.85 billion are spent on credit cards per day in the United Kingdom.
> Credit cards in issue were 181 million in 2006, which works out to be approximately 4 cards for every adult in the United Kingdom.
(SOURCE: Credit Action, www.creditaction.org.uk)
- According to a recent survey conducted by the National Association for Business Economics (www.nabe.com) the combined threat of subprime loan defaults and excessive indebtedness has overtaken terrorism and the Middle East as the biggest short-term threat to the U.S. economy. 32% of the survey participants cited loan defaults and excessive debt as the biggest threat, compared to only 20% citing terrorism as the biggest threat.
(SOURCE: Dan Seymour, Associated Press)
- The average interest rate for standard bank credit cards topped 19% in March 2007, compared to 16.5% in 2003.
(SOURCE: www.cardtrak.com)
- Regarding college students and their use of credit cards:
> 43% of freshman owned a credit card, compared with 74% for 4th and 5th year students.
> 41% of cardholders carried a balance from month to month, and the median amount was $1,000.
> Approximately 25% of cardholders used their credit card to pay for tuition.
(SOURCE: American Council On Education, www.acenet.com, “Credit Card Ownership and Behavior Among Traditional-Age Undergraduates, 2003-2004)
- In 1968, consumers’ total credit debt was $8 billion (in current dollars). Now the total exceeds $880 billion.
(SOURCE: Federal Reserve Bank)
- There has been a 23% increase over the past 5 years in the number of credit cardholders who use cards that accumulate points for merchandise and/or airline tickets.
(SOURCE: Vertis)
- The U.S. federal government has incurred $59.1 trillion in liabilities, or roughly $516,000 per U.S. household. (Not a credit card debt statistic, per se, but interesting nonetheless.)
(SOURCE: Dennis Cauchon, USA Today)
- More than four out of ten young consumers between the ages of 18 and 21 who surf the Web now own a credit card, and 65% of these young consumers used the Web to apply for a credit card.
(SOURCE: Forrester Research)
- At least one in ten consumers have more than 10 credit cards in their wallets. However the overall average number of credit cards per consumer is 4.
(SOURCE: Experian's "National Score Index")
- 29% of low and middle income households with credit card debt reported that medical expenses contributed to their current balances.
(SOURCE: www.demos.org)
- U.S. consumers racked up an estimated $51 billion worth of fast food on their personal credit and debit cards in 2006, compared to $33.2 billion one-year ago.
(SOURCE: www.carddata.com)
- Approximately half of all credit card holders don’t pay the full amount of credit card charges each month. About 11% say they usually pay only the minimum monthly payment but not much more.
(SOURCE: Experian-Gallup Personal Credit Index survey)
- According to the Federal Reserve Bank, 40% of American families spend more than they earn.
(SOURCE: www.federalreserve.gov)
- 23.8% of American households have no credit cards at all -- no bank cards, no retail cards, nothing. 31.2% of the households. paid off their most recent credit card bills in full.
(SOURCE: Liz Pulliam Weston, www.asklizweston.com)
- Only one household in 50 carry more than $20,000 in credit card debt. However, that "one in 50 households" figure represents more than 2 million American homes.
(SOURCE: Liz Pulliam Weston, www.asklizweston.com)
About the Author
Mark Brinker is the founder/CEO of Hoffman, Brinker & Roberts, Inc. (www.hoffmanbrinker.com) Since 1995, Mr. Brinker has been assisting individuals and small business owners in obtaining millions of dollars of debt relief by negotiating mutually acceptable settlements for less than full balance with creditors, collection agencies and attorneys.
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