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      2022 American Household Credit Card Debt Study

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      2022 American Household Credit Card Debt Study
      The annual NerdWallet study shows the credit card debt growing in tandem as the cost of living increases. Additionally, many Americans have financial concerns about the next year.
      By Erin El Issa Senior Writer | Data analysis, personal finance, credit card Erin El Issa writes data-driven studies on personal finance, credit cards, travel, investing, banking as well as student loans. She is a fan of numbers and hopes to demystify data sets to assist consumers in improving the quality of their lives financially. Prior to becoming a Nerd during 2014, she worked as an accountant for tax and freelance personal financial writer. Erin’s work has been mentioned in The New York Times, CNBC, the “Today” programme, Forbes and elsewhere. In her free moment, Erin reads voraciously and tries in vain to keep on top of her two kids. Her home is in Ypsilanti, Michigan.

      Jan 10 Jan 10, 2023

      Written by Paul Soucy Lead Assigning Editor Credit cards, credit scoring Personal financial planning Paul Soucy leads the credit cards content team at NerdWallet. He was an editor with the Des Moines Register, USA Today and Meredith/Better Homes and Gardens for more than 20 years. He later establishing his own successful freelance editing and writing practice. The editor of The USA Today Weekly International Edition and received the highest honor from ACES: The Society for Editing. He holds a bachelor’s degree in journalism as well as a Master of Business Administration.

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      This year has been a very expensive one. Cost of living is increasing faster than incomes, causing many Americans to borrow more to get by. And interest rates that have increased due to inflation are making debt more expensive.
      NerdWallet’s annual look at household debt finds that the balances on credit cards carried from month to month increased over the past 12 months, which totaled around $460 billion by September 2022 . Mortgages, auto loans and overall debt loads also increased over the course of the year, while student loan debt fell slightly.
      Here’s a breakdown of the amount U.S. households owed in total and the average amount for each household for each type of debt, in September 2022 :
      Kind of debt

      The total amount owed by an average U.S. household with this amount of debt

      Total owed in U.S.

      Percentage change for total owed between 2021 to 2022.

      Any kind of debt*


      $16.51 trillion


      Kreditkartes (total)*


      $1.05 trillion


      Credit cards (revolving)


      $459.6 billion




      $11.67 trillion


      Auto loans


      $1.52 trillion


      Student loans


      $1.57 trillion


      * This debt can include mortgages as well as home equity lines of credit and auto loans credit cards, students loans and other household debt according to the Federal Reserve Bank of New York. *Total U.S. credit card outstanding debt comprises transacting and revolving balances. Revolving debt was calculated with the average of the previous five years of percentage of credit card debt deemed as revolving (carried monthly) in contrast to transacting (paid in full each month). The past few years, we’ve received these figures from Experian. The credit bureau refused to provide the revolving vs. transactions data for 2022.

      A note on the data for this year

      The 30% rise in revolving credit card debt which is balances on credit cards that are carried from month to month could be due to two factors: a significant increase in the total amount of credit card debt (revolving or nonrevolving) and a greater amount of the revolving debt. Total credit card debt rose by 15 percent. With the cost of living exceeding increase in income, it stands to reason that the majority of that increase came in through revolving credit. This is only an estimate. We calculated it using the average percentage of revolving loans from the last five years. This figure is higher that the previously low revolving debt percentage of 2021 but is comparable to the percentages in the years before the COVID-19 pandemic.

      The annual study we conduct examines data from the government including such sources as the U.S. Bureau of Labor Statistics and the Federal Reserve Bank of New York — to see how the debt of households changes over the last year. NerdWallet also recently commissioned to conduct an online study of more than 2,000 U.S. adults, conducted by Harris Poll. Harris Poll, to learn more about how Americans are feeling about their debt and what they believe future rates of interest will affect their financial position. We also inquired about Americans’ usage of “buy now and pay over time” services, as well as how your income (or not) kept pace with inflation, and their financial worries for the coming year.
      Key findings
      The price of food is increasing more quickly than incomes. In the past year, the median income of households has only increased by 4%, while the overall cost of living has jumped 8 . The survey revealed that nearly half of employed Americans (45 percent) say their pay hasn’t been growing enough in the last twelve months to keep up with inflation.
      Buy now, pay later services may mean deeper debt for millions. One in five Americans (18%) said they’ve utilized a BNPL service within the last 12 months.
      The American public is worried about their financial stability over the coming year. Nearly 7 out 10 Americans (69 percent) have financial concerns about the coming year. The No. 1 worry is having to go into debt/more in debt to pay for necessities (31 percent), followed by having to pay more interest on their debt (27 percent).
      The average amount of interest on credit cards paid by households is rising due to recently announced Federal Reserve rate hikes and rising amounts of revolving credit card debt. U.S. households that carry credit card debt are expected to pay an average of $1,380 in annual interest . That’s assuming that interest rates don’t go higher.

      “Credit card debt is usually thought to be the result from frivolous purchases, but in the case of the majority of Americans this isn’t true,” says Sara Rathner, a NerdWallet credit cards expert. “Consumers suffer the pressure of increased prices and the rising interest rates, and wages simply aren’t up to par. This is forcing many to take difficult decisions, such as taking out loans to pay for necessities.”
      The cost of living exceeds earnings growth by a significant amount over the last year
      Every year, we examine the increase in the cost of living compared with that of household income over the preceding decade to determine whether income is keeping up with the cost of living. In the 10-year period, we discovered that income growth is on the rise the pace: Median household income is up by 44% since 2012, while total expenses have been up by 28% in the same time frame . However, the picture is drastically different when we look at the short-term growth, due to the COVID-19 pandemic and the extraordinary high rate of inflation.
      Looking at growth over the last three yearsfrom pre-pandemic up to today- median income has grown by 7%, but overall expenses have been up by almost 16percent . This includes a 27% rise in the cost of transportation and a 20 percent increase for food and beverage expenses, and a 14% increase in housing expenses. That could explain the reason, according to our study, 45% of Americans believe their financial health is less good as compared to before when the pandemic COVID-19 was first discovered.
      According to the survey, more than 50% of working Americans (45%) believe that their wages haven’t been increasing enough in the last twelve months to keep pace with the rate of inflation. Consumer price index and income growth data back this up. In the last year, we’ve seen prices soar — 8.2% annual inflation, as of September 2022. That includes 13% rise in transportation costs, 11% in drinks and food costs, and 8% for housing costs. Meanwhile, the median household income has increased only 4% during this time .
      Consumers are doing all they can to fight rising prices. According to the study almost 4 out of five Americans (79%) declare that they’ve taken action in response to rising prices over the last six months. 42 percent of Americans say they’ve driven less, and 39% say they’ve bought more brands from the stores and non-processed staples. Nearly one in five Americans (19 percent) claim they’ve added more debt due to the rise in inflation over the past six months.
      ” Checking your recent spending for areas to cut back and then putting the extra funds towards savings or debt repayment could be very beneficial. ” Sara Rathner , NerdWallet credit card expert

      Debt making Americans feel anxious, overwhelmed
      In the last year, almost 3 in 10 Americans (28%) declare that their overall debt has increased. 14 percent of Americans say they’ve taken on medical debt in this time. This debt is taking its toll.
      According to the study the survey found that 41% of Americans who have debt are worried about it, and 35% are overwhelmed. The feeling of being overwhelmed is most prevalent in Americans who have annual household incomes under $75,000 who currently have debt 44% of the population is feeling this way, as compared with 27% of the indebted Americans who have annual household incomes of $75,000 or more.
      BNPL may be hiding additional debt
      Our annual analysis of household debt examines the traditional types of debt — such as credit cards, mortgages as well as student loans. The data on these debts is compiled and reported by government agencies such as that of the Federal Reserve Bank of New York. But the debt problem may get worse due to the increasing number of short-term loans that are offered by firms such as Affirm or Klarna. BNPL services allow you to buy something now and then make installment payments -usually 25% at the time of purchase and 25% each two weeks until paid off. Longer-term BNPL options typically charge interest, like a traditional installment loan.
      Based on our research roughly one-in-five Americans (18 percent) have used an BNPL service in the past twelve months. This is more common in younger Americans: 25% from Gen Zers (ages between 18 and 25) and 30 percent of the millennials (ages 26-41) have used these services in the past year, compared with 16% of Gen Xers (ages 42-57) and 7% among baby boomers (ages 58-76).
      Certain Americans depend on BNPL service to purchase daily necessities items that are used up before they’re even paid for. According to a report released in September 2022 by the , or CFPB the use of BNPL services for daily or necessary purchases such as utility bills, gas and groceries — was up 434% in the period between 2021 and 2020 and up 1,207% between 2019 and 2020.
      BNPL services are usually interest-free however, they can charge late fees to those who miss payments. The CFPB report found that 10.5 percent of BNPL borrowers were charged at minimum one late fee in 2021. And while late fees tend to be modest at around $7 for an average loan amount of 135 — the report highlights the possible negatives to these services that could become financially unhealthy, like overextension and the taking of more loans than you can reasonably be able to.
      For those who only use BNPL once in a while, overextension probably won’t be an issue. However, for those who stack loans and take multiple loans within a short amount of time, and are frequent BNPL users this payment obligation may hinder your ability to make for other expenses promptly due to the quantity of BNPL payments due. This can lead to late fees, interest charges and even harm to credit scores.
      Many Americans bring financial worries in the year ahead
      The past year has been expensiveand many aren’t optimistic things will get better in the next year. Seven out of 10 Americans (69%) are concerned about financial issues in the next 12 months The top concern being that they will have to take on debt, or even deeper into debt to meet the needs (31%).
      More than 25% of Americans (27%) are worried about having to pay higher rates of interest on their debt in the coming 12 months; this follows a string of rate increases by the Federal Reserve and the possibility of more rate increases in 2023.
      Credit card interest rates are rising and could go higher
      These actions by the Fed have raised the average credit card interest rate for accounts that pay interest to 18.43 percent as of August 2022, according to the Federal Reserve Bank of St. Louis. The highest rate since the St. Louis Fed began tracking this data in 1994. For American households carrying the average amount of credit card debt that is revolving this would result in an annual interest charge of $1,380. The year before, average interest charges were $1,029 annually due to lower credit card debt that is revolving and lower interest rates.
      In the year 2022 Americans saw seven rate increases from the Fed and more may be coming in 2023. According to the study over 3 in five Americans (61%) think that the upcoming rate increases will impact their financial situation, either for good or for ill. However, while 33% of Americans believe that it will make their current debt more expensive and 28% believe that it will make any new loans more expensive, 1 in 5 Americans (20 percent) believe they’ll get more interest from their savings.
      What do Americans can do?
      Take steps to prepare for a recession that could be coming. In the moment there is no recession officially declared, but certain experts believe that we’re currently in one or are about to enter. Even if you are aware that there’s a chance, however it’s difficult to predict what’s to come due to the fact that the effects of a recession aren’t uniform nor universal, and the uncertainty could quickly escalate into calamity. These past several years have given ample evidence of the importance of preparing for unexpected events, and there are ways to mitigate the effects to your financial health.
      If you’re able to do so, you should add funds to your savings regularly. It could be necessary to build up an emergency fund that covers 3 to 6 months of expenses, or perhaps investing more in the event of an eventual income loss. To free up more money to save, look at your budget and see the areas you can reduce. It’s not necessary to cut down on your expenses forever In the short-term it will allow you to beef up your savings faster.
      “If you’re looking at a couple of months worth of expenses are too much to be able to set aside right now, aim to put a few hundred bucks from an account for emergency funds,” NerdWallet’s Rathner says. “It can be enormously helpful when faced with unexpected expenses.”
      ” It’s impossible to influence the economic climate, but you can take the smallest steps to be financially secure now. ” Sara Rathner , NerdWallet expert on credit cards

      It is better to pay now than later, if you are able to. Utilizing a buy now pay later service may be the right choice for you however, before you decide to use one, think about other options. If you have the money to pay off the balance, putting the purchase on a credit card will be rewarded and protect your purchase in the event of a return or defective product. It is also beneficial to save for unnecessary items over 6 weeks — which is the normal BNPL timeframe — and then make the purchase. It is possible that you will no need to buy the item once some time has expired.
      If you decide to utilize BNPL services, you can set automated payments to avoid late charges and limit the number of purchases you make in a short period of time to avoid getting overwhelmed.
      Avoid big financial moves If possible, steer clear of major financial decisions. Due to consumer worries about rising interest rates and the difficulty to obtain, and a decrease in credit limits, you might be advised to delay accepting new credit obligations as long as you are able to. This might not be feasible for you, but that’s fine; sometimes, we just can’t wait for the right moment, particularly when experiencing financial distress. If you’re able to hold back from making any major financial moves and make major financial decisions, it’s probably a great decision to hold off.
      “This is the perfect time to focus on the basics of financial management,” Rathner says. “Checking your spending habits for places to cut costs and then putting the extra money to savings or debt repayment can be a big help.”
      Understand how higher interest rates can affect your finances. More than a fifth of Americans (21%) don’t know if the next interest rate increases will affect their financial position, according to the study. If you’re in the market for credit with variable interest rates, such as credit cards or an equity credit lineor are in a savings account, higher rates will probably affect you. This is also true for credit with fixed rates like the mortgage or auto loan.
      Interest rate increases can increase the cost of your debt however they can increase your savings faster. If you are in debt with a variable rate you should make higher or more frequent payments to pay it down more quickly. Do not apply for large loans that have fixed rates, if you can — higher rates make big purchases, such as a house or vehicle, a lot more costly. If you have a savings account, examine the interest rate. Rates have been incredibly low up to a point, but nowadays, you can find annual percentage rates, or APRs of at least 3.
      “The risk of uncertainty in the economy is always frightening,” Rathner says. “You cannot control the economic system in general however, you can take small steps to feel more financially secure now.”
      This survey was conducted online within The United States by The Harris Poll on behalf of NerdWallet between Oct. 25-27, 2022 with 2,041 U.S. adults 18 and older. The precision of sampling of Harris surveys conducted online is measured by using a Bayesian credible interval. For this study, the sample data is precise to +/+/- 2.8 percentage points using the 95% confidence level. For more information on the survey’s methodology including weighting variables as well as sizes of subgroups, get in touch with Lauren Nash at .
      NerdWallet’s analysis includes data from the following sources:
      September 2022, in the Federal Reserve’s Center for Microeconomic Data.
      December 2021, taken from The U.S. Census Bureau.
      From members of the Board of Governors of the Federal Reserve System.
      , September 2022, from the U.S. Bureau of Labor Statistics.
      December 2021, taken from The U.S. Census Bureau.
      , September 2022, in The U.S. Bureau of Labor Statistics’ National Compensation Survey.
      August 2022. From The 2022 August issue of the Federal Reserve Bank of St. Louis.

      Expand to footnotes for footnotes

      [1] The credit card that is revolving analyzed differently from other types of household debt. The Federal Reserve Bank of New York utilizes data from Equifax which is among the three major credit reporting bureaus located in the U.S., as the source for its data on credit card debt and includes accounts with revolving balances (debt carried between months) as well as transacting balances (debt that will be paid off at the next statement). We’ve previously relied on information from the credit bureau Experian to determine the percentage of balances which were transacted and revolved on credit cards issued by banks. Experian did not provide this data for 2022 We therefore utilized the median of percentages from 2017 through 2021. Data about revolving balances on retail credit cards was not available thus we assumed cardholders revolved their debt on both retail credit cards and bank credit cards at the same time. Then, we multiplied the total outstanding credit card balances within the U.S. — $1.05 trillion at the time of September 2022 — by the proportion of debt that is revolving. (According according to New York Fed, the household’s credit card balances of $925 billion as of September 2022, which includes credit cards for banks, but they do not include retail credit card debt. To make this number more representative of the total creditors, we rounded up the $925 billion and compared the 25% reported “other” debt. The New York Fed says about one quarter of the so-called other debt is outstanding retail credit card debt.) Finally, we divided this amount by the number of households that have the revolving credit card debt. We estimated the number of household members by multiplying amount of U.S. households, projected using data published at the close of 2021, and then dividing it by the percentage of households who have the debt (using estimates for 2022 based on 2019 data of the Federal Reserve’s Survey of Consumer Finances).
      2] To estimate the amount of debt owed by households for each category — with the exception of revolving credit card debt, we calculated the average of each type of debt that was reported to the Federal Reserve Bank of New York and then divided this amount by the total number of houses with this type of debt. We estimated the number of household debt by multiplying total amount of U.S. households, projected from data that was released at the end of 2021, and then dividing it by the percentage of households with this type of debt, based upon data from the 2019 Survey of Consumer Finances.
      [3] Consumer price indexes, also known as CPIs track the changes in prices for various consumer products and services. The price indexes we studied include the cost of clothing as well as education and communications as well as food and beverages as well as food and beverages at home, food away from home, housing medical, other goods and services, leisure and transportation. As per the U.S. Bureau of Labor Statistics the price index of everything increased from 274.214 and then 296.761 in the period between September 2021 and September 2022. Transportation CPI increased by 237.107 to 267.043, food and beverage CPI rose by 280.413 to 310.635 and housing CPI was up between 283.532 and reached 306.323 between September 2021 and September 2022. To assess the growth in the price index categories with income growth since 2012, we projected the 2022 median household income by using the 2021 median reported income of $70,784, and then increasing or decreasing it according to the changes in quarterly percentages reported within the Bureau of Labor Statistics’ Employment Cost Index data for civilians. Based on Census data, the median household income was $70,784 by 2021 and our projections indicate a median household income of $73,653 for 2022.
      4. To calculate interest rates on credit cards over the time of the year, we applied our estimate of revolving credit card debt as well as data on the average interest rate for credit card accounts that have been assessed interest by the Federal Reserve Bank of St. Louis from August 2022. With a steady balance, we divided the average revolving credit card debt among households with outstanding credit card loans by the APR average. This is merely an estimate. To make it easier our calculations do not take into account the daily compounding of balances or fluctuations in balances.
      5. As per the U.S. Bureau of Labor Statistics, the price index for all items increased by 231.015 to 296.761 in the period between September 2012 and September 2022. Based on Census information the median household income was $51,017 in 2012. our projections predict the median household income to be $73,653 by 2022.
      [6] As per the U.S. Bureau of Labor Statistics The price index for all goods grew from 256.596 up to 296.761 in the months of September to September 2022. Transportation CPI increased to 209.896 to 267.043 Food and beverage CPI rose to 258.59 to 310.635 while housing CPI increased between 267.555 to 306.323 in the period between September and September 2022. Based on census data the median household income in 2019 was $68,703; our projections show an average household income of $73,653 in 2022.

      The author’s bio: Erin El Issa is an expert in credit cards and writer on studies at NerdWallet. Her work has been featured on USA Today, U.S. News and MarketWatch.

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