Many Americans Expect To Miss Credit Card Payments in the Coming Months

A September consumer survey just released by the Federal Reserve Bank of New York revealed that a significant number of Americans are worried about credit card debt. Specifically, the survey respondents were concerned about making their minimum monthly payments.

The probability of missing a payment in the next three months reached 14.2%. The last time consumers were this nervous was in April 2020 when 16.1% thought missing a credit card payment was likely.

According to Fed data released in August, total household debt reached $17.8 trillion. Outstanding credit card balances went up almost 6% year-over-year, hitting $1.14 trillion in the second quarter of 2024. The typical household owes about $104,215, which includes a mortgage.

Along with rising credit card balances, delinquencies are also increasing. The number of accounts 90 days or more past due reached 9.1%. The number of consumers filing bankruptcy also went up, and about 5% of consumers received a notice from a third-party debt collector.

Americans Are Worried About Finances

It seems Americans are “stressed” about their financial situation. A recent survey found just over half of middle-income households view their current finances as negative.

When it comes to credit card balances, 44% of respondents said they are more worried this year than they were in 2023. Over the last quarter, credit card balances rose for 35% of them.

“For people with good incomes and good credit scores, things are going well; they’re still able to access plenty of credit and, by and large, paying on time,” Bankrate analyst Ted Rossman told CNN. “If you’re in the half who’s using a card for convenience and rewards, life is good. Now the other half, that can be a much more troublesome situation when you think about potentially longer-term credit card debt.”

Of households earning $100,000 or more annually, only 8.4% are expected to miss a credit card payment in the next three months. Yet, the number jumped to 20% for households earning less than $50,000, per the Fed’s survey.