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Americans’ credit-card balances just zoomed past prepandemic levels


At the end of 2022, Americans racked up credit-card debt at the fastest pace New York Federal Reserve researchers have ever seen, underscoring how many people are turning to cards to keep up with rising costs.

Credit-card balances grew by $61 billion during the fourth quarter, totaling $986 billion as Americans shopped for the holidays amid high inflation that also affected other parts of their lives, quarterly household-debt numbers from the New York Fed show.

The $986 billion in aggregate credit-card debt now surpasses the prepandemic high of $927 billion, the researchers said. The quarter-to-quarter increase is the largest jump they have seen for credit cards since the New York Fed started tracking the data more than two decades ago.

Including debts like mortgages, credit cards, car loans and student loans, Americans added $394 billion to their debts during the fourth quarter. That brings their total balance to $16.9 trillion, a $2.75 trillion increase since just before the pandemic.

Credit-card balances grew by $61 billion during the fourth quarter, totaling $986 billion.

Even as debt loads grow heavier, most people are keeping up with their bills — or at least not falling too far behind.

The share of delinquent debt continued to grow during the fourth quarter for just about all categories, credit cards included. But that’s coming off two years of historically low delinquency levels.

For example, the share of credit-card debt that is three months behind on payments increased to 4% from 3.2% one year earlier. Before the pandemic, that number was 5.3%, the researchers noted.

Looking more closely at the delinquency demographics, the researchers say borrowers in their 20s, 30s and 40s are starting to fall behind on their credit-card bills and car loans.

In fact, half of Americans say they are in a worse financial situation than a year ago, according to a recent Gallup poll.

In January, inflation rates cooled for a seventh straight month but still came in hotter than estimates, according to the consumer-price index. Inflation rates on wholesale goods were also higher than hoped, data released Thursday showed.

Borrowers in their 20s, 30s and 40s are starting to fall behind on their credit-card bills and car loans, researchers say.

That will add fuel to the debate about how high the Federal Reserve needs to increase rates. Rising benchmark interest rates may further cool inflation, but they also boost many people’s borrowing costs, including credit-card annual percentage rates, or APRs.

The average APR on new credit cards is now 23.55%, an increase from 23.39% last month, according to

It’s difficult to calculate just how much of the rising debt loads are related to higher interest rates, researchers noted.

“Credit-card balances grew robustly in the fourth quarter, while mortgage and auto-loan balances grew at a more moderate pace, reflecting activity consistent with prepandemic levels,” Wilbert van der Klaauw, economic research adviser at the New York Fed, said in a statement.

“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,” he added.

Student-loan balances stood at $1.6 trillion in the fourth quarter of 2022, up $21 billion from the third quarter, researchers said.

Hanging over this is the ongoing pause on student-loan payments and the pending Supreme Court decision about the Biden administration’s $10,000 loan-forgiveness order. The Biden administration has said it will keep the pause in place until no later than 60 days after June 30.

The New York Fed researchers said they’d be watching to see what any resumed student-loan payments would mean for Americans’ debts and delinquencies.

The Supreme Court has scheduled oral arguments on the challenges to Biden’s order for Feb. 28.


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