The average American’s credit card debt as of the second quarter of 2019 is $6,194, according to the multinational consumer credit reporting company Experian. The figure is an increase from $6,040 in 2018.
"Americans continue to show their confidence using credit in 2019 as 61% of people now have a credit card. That consumer confidence is reflective of lenders' attitude toward providing more credit access to consumers," says Shannon Lois, head of analytics, consulting & operations at Experian.
Based on Federal Reserve data, the average credit card APR as of November 2019 was 14.87%. This amount covers accounts without interest, such as 0% APR introductory rates. For those with accounts that are assessed interest, the average APR is about 16.88%.
The appeal of credit card usage is not only limited to adults. A TransUnion study revealed that 50% of “credit-active” Gen Z in the U.S. own a credit card. “Gen Z is showing this appetite for credit,” Matt Komos, vice president of financial services and consulting at TransUnion, stated in a CNBC Select interview. “Credit cards are a typical entry point for lenders and banks, and we’re seeing that it’s still the case with Gen Z consumers.”
Financial stress
However, according to a LendingTree survey of more than 1,500 Americans in 2019, around 60% feel burdened by debt as they welcomed 2020. At the same time, 53% of the participants are optimistic about achieving financial success in the next decade. Moreover, 64% are confidence they will be out of debt by 2030.
Despite the high use of credit cards, US employees are still dealing with financial stress. It affects their performance at work. Data from Salary Finance’ report shows that 30% of Americans run out of money before their pay day. This causes them to opt for high-cost sources of credit, such as credit cards, payday loans, and overdraft fees.
In addition, younger generations are reported to be struggling more as 30% have paid over $100 in overdraft fees in the last year. Meanwhile, 15 percent of them have taken out a high-interest payday loan.
