59 million added to credit card debt since the start of the COVID-19 pandemic



NEW YORK – September 27, 2021 – 42% of American adults with credit card debt, or roughly 59 million people, have added to their credit card debt since March 2020, according to a report from Bankrate.com. Of those who racked up additional credit card debt during this time, 47%, or 28 million, said the debt was a direct result of the COVID-19 pandemic. Going forward, less than a third (30%) of American adults with credit card debt expect to be free from it within a year. Click here for more information:


While the likelihood of owning credit card debt is constant across cohort to cohort, there are significant differences in terms of who has added to their debt since the start of the COVID-19 pandemic in March 2020. .52% of both Gen Z (ages 18-24) and Millennials (ages 25-40) with credit card debt added to their debt since March 2020, compared to just 38% of the generation. X (aged 41 to 56) and 33% of baby boomers (aged 57 to 75). Additionally, among those who increased their credit card debt around this time, Millennials and Gen Xers are the most likely (52% each) to blame the pandemic for their accumulation of additional debt, compared to baby boomers. (44%) and zoomers (40%).

“Overall, Americans have saved more and paid off debt over the past 18 months, but these improvements have not been distributed evenly,” said Ted Rossman, senior industry analyst at Bankrate.com. “Unfortunately, a substantial percentage of Americans are doing much worse financially, and this is sometimes lost in macroeconomic trends.”

More than half (54%) of American adults have month-to-month credit card debt. In addition, 50% of this group has been in credit card debt for at least one year, including 32% for at least two years and 14% for at least five years.

Credit card debt is more prevalent among middle-income households (earning between $ 40,000 and $ 79,999 per year). 61% of middle-income households have credit card debt, compared to 54% of low-income households (earning less than $ 40,000 per year) and 50% of highest-income households (earning $ 80,000 or more). more per year).

The highest-earning households with credit card debt are more likely to be in the red for at least five years (23%), compared to 13% of middle-income households and 11% of low-income households.

While only 30% of those with credit card debt expect to be free of it within a year, the figure rises to 60% within five years. However, 28% of credit card debtors believe it will take more than five years to be released from credit card debt, including 5% who expect to die with credit card debt. 12% more do not know when they will be able to pay off their credit card debt.

Credit card debt remains taboo, with just over half (53%) of current credit card debtors saying they are comfortable discussing their debt with family and close friends . Credit card debtors were more likely to say they would be comfortable discussing their views on COVID-19 protocols (83%), their religious views (79%), their health (78% ), their political opinions (77%) and their weight (65%). The one topic that credit card debtors considered more taboo than their debt was their dating life, with only 51% saying they would be comfortable discussing the topic with family and friends. relatives.

“Credit card debt can be particularly harmful and persistent because the average interest rate is north of 16%,” Rossman added. “If you are struggling with credit card debt, consider contacting a nonprofit credit counseling agency such as Money Management International or GreenPath. You could also benefit from a 0% credit card balance transfer or a low rate personal loan. And look for ways to increase your income and reduce your expenses so that you can funnel more money into your high cost credit card debt.

From September 16 to October 16, 2021, Bankrate.com is organizing the “Sweepstakes Drop Your Debt”, during which 5 lucky winners will receive $ 10,000 for their debt. For more information, please visit: https://www.bankrate.com/sweepstakes/?utm_source=pr&utm_content=sweepstakes_pr No purchase necessary. Ends 10/16/21. See the official rules.

Bankrate.com commissioned YouGov Plc to conduct the investigation. All figures, unless otherwise stated, are from YouGov Plc. The total sample size was 2,400 adults, of whom 1,297 had credit card debt. Fieldwork was undertaken from September 1-3, 2021. The survey was conducted online and meets rigorous quality standards. It used a non-probability sample using both upstream quotas during collection and then a downstream weighting scheme designed and proven to provide nationally representative results.


Leave A Reply

Your email address will not be published.