Borrowing to Make Ends Meet: The Rapid Growth of Credit Card Debt in America

Borrowing to Make Ends Meet: The Rapid Growth of Credit Card Debt in America

November 7, 2007
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Americans carry over $800 Billion in credit card debt. Using most recent data from the Federal Reserve Board's Survey of Consumer Finances, Borrowing to Make Ends Meet exposes this and other disturbing trends in American families’ debts and financial assets. The report breaks down debt and asset data by age, race and income demographics, and shows how financial fragility makes the most vulnerable groups of Americans even more so.

Top Facts:

  • Between 1989 and 2006, Americans’ overall credit card debt grew by 315 percent from $211 billion to $876 billion (2006 dollars).
  • Nearly six out of 10 households with credit cards revolved their balances in 2004.The average amount of credit card debt among those households reached an all-time high of $5,219, an increase of 89 percent from $2,768 in 1989.
  • From 1989 to 2004, the percentage of credit cardholders incurring fees due to late payments of 60 days or more increased from 4.8 percent to 8.0 percent.
  • In 2004, the average credit card-indebted family allocated 21 percent of its income to servicing monthly debtcompared to the 13 percent dedicated to debt payments among all households.
  • While white households carry more credit card debt, African Americans and Latinos have a higher percentage of credit card-indebted households. In 2004, of those with credit cards, 84 percent of African-American households and 79 percent of Latino households carried credit card debt compared with 54 percent of white households.
  • Since 1989, Americans in the age group of 65 and over have experienced the greatest increase in the amount of credit card debt carried. The average balance for this age group increased 194 percent from $1,669 in 1989 to $4,906 in 2004.