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American credit card debt overview:
- Who: The Federal Reserve Bank of New released its Quarterly Report on Household Debt and Credit last week.
- Why: The central bank’s quarterly report showed Americans’ debt total increased to a record $16.9 trillion in fourth quarter 2022.
- Where: The quarterly report includes consumers nationwide.
Americans racked up credit card debt at record rates last year, according to data released by the Federal Reserve Bank of New York last week.
Total household debt in the United States reached a record $16.9 trillion in the fourth quarter of 2022, an increase of $394 billion from the three months prior, according to the Quarterly Report on Household Debt and Credit.
The fourth-quarter debt total was an increase of $394 billion from the three months prior. The majority of the debt can be attributed to mortgages, according to the report.
The report showed that a total of 18.3 million American borrowers were behind on a credit card payment last year — an increase of around 2.5 million since the end of 2019 that is affecting mostly younger borrowers.
Delinquencies also increased last year while credit card balances in general increased by almost 6.6% to $986 billion during the fourth quarter — the highest growth increase ever recorded.
Credit card balances increased 15.2% year-over-year in fourth quarter 2022
Credit card balances rose 15.2% year over year in total, according to the report. The debt increase comes amid a period of inflation that the Federal Reserve attempted to quell with sweeping rate hikes, CNN Business reports.
The interest rate hikes have particularly affected the housing industry, with the central bank’s report showing mortgage originations fell to 2019 levels during the fourth quarter last year.
“Although historically low unemployment has kept consumers’ financial footing generally strong, stubbornly high prices and climbing interest rates may be testing some borrowers’ ability to repay their debts,” Wilbert van der Klaauw, economic research adviser at the New York Fed, says in a statement.
Americans are also struggling to meet their payment obligations amid the high inflation and interest rates, with delinquency transparency rates for both credit card and auto loans increasing, according to the report.
In related credit-card debt news, the Consumer Financial Protection Bureau proposed new rules earlier this month that were aimed at helping curb excessive credit card late fees.
Did your credit card debt increase last year? Let us know in the comments.
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14 thoughts onAmerican credit card debt increases at record rates
Yes Mine all have gone up. I have judgements, Irefuse to pay them
Bank of america interest was low and every year they would raise it and was very misleading from my terms . It got so high with interest after my bill reached max . Stopped paying . they had terrible customer service when I was trying to make payment arrangements
add me to this please contact me viva email : shakebone@verizon.net