American Credit Card Owe a Record High 1.21 Trillion in Credit Card Debt

Americans now owe a staggering $1.21 trillion in credit card debt, with rising delinquencies signaling financial distress. With inflation still high and interest rates exceeding 20%, many are struggling to keep up with payments, raising concerns about long-term economic stability.

Key Facts:

Americans owe $1.21 trillion in credit card debt as of Q4 2024, per the New York Fed.
This marks a $45 billion increase from Q3 2024 and a 7.3% jump year-over-year.
Over 600 million credit card loan accounts exist, making them the most common form of debt.
The average interest rate on new credit cards exceeds 20%, making it an expensive borrowing option.
Over 7% of credit card debt is seriously delinquent, meaning payments are overdue by 90+ days.

The Rest of The Story:

Credit card debt in the U.S. has soared past $1.2 trillion, adding billions each quarter as inflation erodes consumers’ purchasing power.

The New York Federal Reserve’s latest report highlights a troubling trend: more Americans are relying on credit cards to cover basic expenses, pushing delinquency rates higher.

While total consumer debt exceeds $18 trillion, mortgage debt remains the largest portion at $12.6 trillion, followed by auto loans and student loans.

Mortgage debt grew by $353 billion year-over-year, while credit card debt surged at a faster rate.

With interest rates on credit cards exceeding 20%, many Americans are finding it increasingly difficult to manage payments, leading to rising delinquencies.

Credit card debt increased by $45 billion and auto loan balances rose by $11 billion by the end of Q4:2024, according to the Quarterly Report on Household Debt and Credit, hitting $1.21 trillion and $1.66 trillion, respectively.https://t.co/XbJC7no6pl pic.twitter.com/OoMZdE5QMb

— New York Fed Research (@NYFedResearch) February 13, 2025

Commentary:

The explosion in credit card debt should be a wake-up call.

Americans are borrowing at unsustainable levels, often just to cover essentials like food and gas.

With inflation still squeezing household budgets, more people are falling behind on payments, and the number of seriously delinquent accounts is climbing.

The situation is even worse for those stuck paying 20%+ interest—a rate that compounds the financial pressure many families already feel.

The fact that over 7% of all credit card debt is now 90+ days overdue suggests that many consumers simply can’t keep up.

And with no significant wage growth keeping pace with inflation, these debts will only become harder to manage.

Some are effectively trapped, making minimum payments while their balances balloon due to high interest rates.

Trump previously campaigned on reining in credit card interest rates, recognizing that Americans are being crushed by excessive borrowing costs.

The Visa/MC credit card monopoly has put Americans into excessive debt with usurious interest rates at 25%+

President Trump wants a 10% cap on all credit card interest rates

JD Vance co-sponsored the Credit Card Competition act which fights the 2-4% hidden tax you pay every… pic.twitter.com/PKF5MsMExK

— DC_Draino (@DC_Draino) November 11, 2024

If he follows through on this promise, it could provide relief to millions of households struggling to escape the debt cycle.

However, without serious policy changes, the situation is likely to worsen. The longer people rely on credit just to get by, the deeper the financial hole becomes.

The Bottom Line:

Credit card debt in the U.S. has reached crisis levels, with over $1.2 trillion owed and delinquency rates rising fast.

High inflation and soaring interest rates have made it nearly impossible for some Americans to stay afloat.

Without intervention—whether from policy changes or economic shifts—this debt spiral could lead to even greater financial instability.