Credit Card Balances End Year At Record High

U.S. credit card debt hit $870 billion – the largest amount ever – as of December 2018, according to the data from the Federal Reserve. Credit card balances rose by $26 billion from the prior quarter.

“The increase in credit card balances is consistent with seasonal patterns but marks the first time credit card balances re-touched the 2008 nominal peak,” according to the report.

Nearly 480 million credit cards are now in circulation — up by more than 100 million since hitting bottom after the recession a decade ago.

At the end of last year, credit cards were the fourth-largest portion of consumer debt in the U.S. after mortgage, student loan and auto debt. But the quarterly increase in credit card debt was faster than the other categories. Overall debt reached a record $13.5 trillion.

About 37 million credit card accounts had a 90+ days delinquent mark added to their credit report last quarter, an increase of about two million from the fourth quarter of 2017. These 37 million accounts hold roughly $68 billion in debt that is 90-plus days delinquent.

In aggregate, credit card limits rose for the 24th consecutive quarter, with a 1.5% increase in the fourth quarter of 2018.

Among the age groups holding credit card debt, those 60 and older accounted for 30% of the total while those in their 70s accounted for more than 1 in 9 dollars of the debt, noted Bloomberg. What’s more, the data shows that credit card debt for older Americans is moving into delinquency at a faster rate. Those in their 50s — a group that holds more than 24% of credit card debt — may be the most vulnerable should job loss or salary reductions occur.

Source:  Federal Reserve, Bloomberg, PYMNTS