WASHINGTON—A new study reveals that consumers ended the year with a record $57.1 billion net increase in credit card debt – 47% more than 2013 and 55% more than 2012.
Growing consumer credit card debt statistics support the notion of a rapidly improving economy, evidenced by the fact nearly three million jobs were added in 2014 while the unemployment rate closed the year at 5.6%, reports CardHub, which released it’s 2014 Credit Card Debt Study. The fact that defaults are at their lowest level since CardHub’s sister company WalletHub began tracking credit card debt six years ago also indicates that consumers have the financial wherewithal to remain current on their obligations.
That’s the good news, CardHub explained.
The bad news is that while economic gains are making spending habits sustainable for now, attitudes toward debt have not improved since the Great Recession. With consumers ending 2014 with a $57.1-billion net gain in credit card debt, CardHub projects that consumers will tally more than $60 billion in new credit card debt during 2015 – a 5% increase.
“We’ve now had six consecutive quarters of year-over-year increases in our credit card debt load,” CardHub stated. “As a result, we must strive to remember the corrosive impact of debt on household finances during the recession and work to get out from under its influence before the burden becomes unbearable again.”
Other study highlights:
- U.S. consumers incurred $45.5 billion in credit card debt during the fourth quarter alone.
- While defaults are at a six-year low, the average household’s credit card balance – nearly $7,200 as of the end of 2014 – is growing dangerously close to the $8,300 tipping point previously identified by CardHub as being unsustainable.
Consumers have now racked up close to $180 billion in credit card debt following the nearly debt-neutral years of 2009 and 2010.