Credit card debt reached an all-time high in the second quarter of this year. According to data from the New York Federal Reserve (Fed) the level of debt for the period from April to June reached $1.03 trillion, an increase of almost 4.6% ($45 billion) over the first quarter of 2023.
HHDC_2023Q2 by Verónica Silveri on Scribd
These record debt levels in the credit card category drove the increase in overall household debt, which reached $17.06 trillion. According to the Fed:
Total household debt increased by $16 billion to $17.06 trillion in the second quarter of 2023, according to the latest Quarterly Household Debt and Credit Report. Credit card balances experienced strong growth, rising $45 billion to an all-time high of $1.03 trillion.
Most Americans live from paycheck to paycheck
A Bankrate survey already revealed last year that the use of credit cards was on the rise. The survey found that 42% of Americans aged 27 to 42 (millennials) increased their use of credit to cover their daily expenses, as well as 27% of people aged 43 to 58 years (Generation X).
Current data show that the percentage of consumers living paycheck to paycheck is on the rise. In December 2022, some 166 million Americans said their monthly salary was not enough to cover their expenses. The figure is equivalent to 64% of the national population and represented an increase of 3% year-over-year compared to the 61% who reported doing so in December 2021.
Ted Rossman, senior industry analyst at Bankrate, noted:
