Americans’ Credit Card Balances Hit New Peak
Credit & Collection e-newsletter of 8/28/23 reports that Americans’ credit card balances rose briskly in the second quarter of 2023, hitting a sobering milestone of more than $1 trillion, the Federal Reserve Bank of New York reported this month. Credit cards are the most prevalent type of household debt, New York Fed researchers wrote in a blog post, and saw the biggest increase of all debt types. More than two-thirds of Americans had a credit card in the second quarter, up from 59% roughly a decade earlier, the researchers found. And, they noted, card balances were more than 16% higher in the second three months of this year compared with a year earlier. “It’s easy to become overwhelmed by credit card debt, and $1 trillion tells us that many Americans are making purchases with money they don’t necessarily have,” said Ben Alvarado, executive vice president and director of core banking at California Bank & Trust. Car loan defaults are up also. Both these things usually result in more bankruptcies being filed by individuals.