Credit card debt set to hit record levels as consumer holiday spending rises

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Source: CNBC

Published Fri, Dec 27 2024 10:21 AM EST


Heading into the holidays, many Americans were already saddled with record-breaking credit card debt. And yet, consumer spending is set to reach a fresh high this season.

The National Retail Federation reported last week that spending between Nov. 1 and Dec. 31 is “clearly on track” to reach a record, between $979.5 billion and $989 billion. “Job and wage gains, modest inflation and a heathy balance sheet have led to solid holiday spending,” the NRF’s chief economist, Jack Kleinhenz, said in a statement.

But other reports show that many shoppers are increasingly leaning on credit cards to manage their holiday purchases. To that point, 36% of consumers have taken on debt this season, a recent report by LendingTree found. And those who dipped into the red racked up an average of $1,181, up from $1,028 in 2023, according to the survey of more than 2,000 adults.

“No one should be surprised that so many Americans took on debt this holiday season. Prices are still really high and that means that lots of Americans simply didn’t have any choice,” said Matt Schulz, LendingTree’s chief credit analyst. “Inflation is still a big deal in this country, and it’s having a huge impact on people’s finances, including their holiday spending,” he said.

Read more: https://www.nbcnews.com/business/personal-finance/credit-card-debt-set-hit-record-levels-consumer-holiday-spending-rises-rcna185562