Concerns of a pending recession and the reality of high inflation are putting enough pressure on Americans so that they acquired $67.1 billion in credit card debt in the second quarter of 2022.
According to WalletHub’s latest Credit Card Debt Study, released Monday, this is an all-time record for credit card debt added during the second quarter of a year.
WalletHub projects that consumers will add a total of $110 billion in debt during 2022.
With the Federal Reserve expected to raise its target rate by 75 basis points on Sept. 21, this new debt balance is likely to become more expensive than Americans anticipate. WalletHub expects credit card debt to cost Americans an extra $5.3 billion in the next 12 months.
Some areas of the U.S. have bigger payment concerns than other areas, according to WalletHub, so data is available that compares states with the biggest and smallest debt. The data compares credit card debt balances that changed in the second quarter of 2022.
California has the biggest debt increase for the second quarter of 2022, followed by Texas, Florida, New York and Illinois. Alaska has the smallest debt increase, followed by South Dakota, North Dakota, Wyoming and Vermont.
Most notably, the data reveals that consumer credit card debt for the second quarter of 2022 was 3.5 times larger than the post-Great Recession average for a second quarter.
According to WalletHub, 85 percent of Americans are worried about inflation right now, and 63 percent say their wallets have been affected this year by the federal rate increases. Inflation has affected 62 percent of Americans’ monthly expenses, including grocery expenses, gas and housing. Seventy-one percent of Americans think the government should put a cap on gas prices.
WalletHub also reports that 44 percent of Americans are not financially prepared for a recession, and 56 percent would prefer high unemployment to high inflation.
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Rebecca Barnabi
