Credit Card Debt Hits Record High

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This article was authored by:  Ivana Pino

Debt balances continue to rise, according to the latest data from the Federal Reserve Bank of New York. The latest quarterly report on household debt and credit shows that total household debt increased by $191 billion in the fourth quarter of 2025, to a new high of $18.8 trillion. Notably, credit card balances rose by $44 billion in the fourth quarter to a record high of $1.28 trillion; mortgage balances grew by $98 billion, totaling $13.17 trillion; and auto loan balances increased by $12 billion, totaling $1.67 trillion at the end of 2025. Delinquency rates also saw a steep increase in the fourth quarter, with 4.8% of outstanding debt in some stage of delinquency, driven by defaults among younger and lower-income borrowers and further evidence of a bifurcated, or “K-shaped,” economy. Transitions into serious delinquency increased for credit card balances, mortgages, and student loans, while auto loans and home equity lines of credit decreased slightly. Student loan delinquencies continued to rise, with roughly 1 million borrowers in default and millions more delinquent on payments. Bankrate’s 2025 Credit Card Debt Report found that 46% of U.S. adults who have credit cards are currently carrying a balance, often because it’s the only way to cover everyday necessities. To make matters worse, average credit card interest rates currently hover over 20%. The good news is some delinquency rates have stabilized, while others are falling. Credit cards and personal loans are performing at or below delinquency rates experienced in 2024. Those in their prime earning years have survived the perfect storm of recession, pandemic, and inflation. The cost of housing doubled between 2018 and 2024. The cost of a new car doubled between 2011 and 2025. Meanwhile, purchasing power grew less than 12% over that same span. With those economic factors stacked against them, where else are Americans going to turn? No surprise, it’s credit cards.”