Americans began 2019 owing more than $1 trillion in credit card debt. Although the forecast initially appeared brighter, thanks to consumers repaying $38.2 billion in credit card debt during Q1 2019, poor second-quarter results nearly erased that effort. U.S. consumers added $35.6 billion in new credit card debt during the second quarter of 2019 – the largest second-quarter build-up ever. As a result, WalletHub now projects a $70 billion net increase in consumer credit card debt for 2019 overall.
Outstanding credit card debt is at the second highest point since the end of 2008, having hit an all-time high in Q4 2018 of $1032.4 billion. However, the $35.6 billion in credit card debt added during Q2 2019 is 64% higher than the Q2 2018 increase. The U.S. ended 2018 with $66.5 billion in new credit card debt, and WalletHub projects a $70 billion increase in 2019. Since the end of the Great Recession, consumer performance has regressed on a year-over-year basis in 6 of every 10 quarters.
The average household’s credit card balance, at $8,602, is $1,519 below WalletHub’s projected breaking point. The five states with the highest total credit card debit are California, Texas, Florida, New York and Illinois. The states with the lowest total credit card debit are Vermont, Wyoming, North Dakota, South Dakota, and Delaware. The states with the highest household debit were: Alaska, Hawaii, Virginia, California, and Maryland, whereas the five lowest states were: Iowa, Vermont, Wisconsin, North Dakota, and Maine.
WalletHub’s quarterly credit card debt studies are based on analysis of the latest data on consumers’ finances available from TransUnion as well as the Federal Reserve. Quarterly changes in credit card debt levels include both the total amount outstanding and charged-off debt that is no longer on credit card companies’ books but consumers continue to owe.
For more information, visit wallethub.com.