More Americans than ever before are using more credit cards for a variety of purchases and getting dangerously close to the cards’ spending limits.
That is the conclusion of several new reports noting that, while retail spending this fall has remained healthy, consumers are exhausting their credit cards.
According to a monthly tracking effort conducted by the financial services firm Goldman Sachs, the average 30-day plus credit card delinquency rate rose by 0.16% from September to October.
That 0.16% figure is a big increase over the 0.06% increase that is normally seen in the fall months.
The trend line, suggests the Wall Street Journal, shows that “some Americans’ spending habits might not be sustainable, at least when it comes to their cards.”
The paper added that some card users appear to be consuming “more of their available credit from month to month–and could hit the wall once those lines are exhausted.”
According to consumer debt data compiled by the Federal Reserve Bank of New York, Americans’ total credit card balance stood at just over $1.079 trillion in the third quarter of this year. That’s up from an earlier record of $1.031 recorded in April to June of this year.
Both sets of figures represent the highest balance levels since the New York Fed began tracking such trends in 1999.
Notes the site Lendingtree: “Credit card balances have risen by $223 billion since the fourth quarter of 2021.” In fact, total credit card debt today is now $152 billion higher than the last record reached in the fall of 2019.
The Lendingtree analysis concludes by adding: “Thanks to record interest rates, stubborn inflation, and myriad other economic factors, credit card balances are likely only going to climb, at least in the near future.”
By Garry Boulard
