A whopping 37 percent of credit card holders have either maxed out or come close to it since inflation gripped the nation under the policies of the Biden-Harris administration, a Bankrate/YouGov survey found Thursday.
Credit card debt rose significantly due to rising costs,which soared about 20 percent on average across the board.
“Inflation does not care if you are rich or poor. Everyone can feel its wrath,” Bankrate analyst Sarah Foster stated. “With limited options to absorb those higher costs, many low-income Americans have had no choice but to take on debt to afford costlier essentials — at a time when credit card rates are near record highs.”
Bankrate reported the survey’s historic results, noting credit card debt hurt “groups,” particularly those that are “vulnerable” to inflation:
Nearly 2 in 5 cardholders (37%) have maxed out a credit card or come close since the Fed started raising interest rates, Bankrate’s Credit Utilization Survey found. That includes 20% who have maxed out a credit card and 17% who have come close to maxing one out.
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Utilization rates at an aggregate, nationwide level seem stable, even as credit card debt hit a new record of $1.14 trillion in the second quarter of 2024, according to the New York Fed’s Household Debt and Credit Report. The average credit card utilization rate was 21.3 percent in August, in line with a historic norm since 2011 of 20-22 percent and below the 30 percent rule-of-thumb that experts typically recommend, according to Equifax data.
Bankrate’s findings, however, offer a closer examination, revealing that some pockets of distress could be forming as some groups — particularly those who have been vulnerable to inflation — utilize more credit than others. Equifax data also shows that utilization rates have surged from where they stood in March 2022 (18.6 percent). Back in April 2021, meanwhile, the average utilization rate hit the lowest levels ever recorded (18 percent).
The poll sampled 3,576 U.S. adults from September 11-13.
LendingTree reported on the rise of credit card debt that coincides with policies under the Biden-Harris administration:
Americans have an absolute mountain of credit card debt — $1.142 trillion, to be exact.
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Credit card balances have risen by $372 billion since the first quarter of 2021. Americans’ credit card debt is $215 billion higher than the record set in the fourth quarter of 2019, when balances stood at $927 billion. However, thanks to record interest rates, stubborn inflation and myriad other economic factors, credit card balances are likely only going to climb.
Wendell Husebo is a political reporter with Breitbart News and a former RNC War Room Analyst. He is the author of Politics of Slave Morality. Follow Wendell on “X” @WendellHusebø or on Truth Social @WendellHusebo.
