Holiday expenses push credit card debt to new heights for many Americans
SEATTLE, Nov. 26, 2024 /PRNewswire-PRWeb/ -- CreditCards.com, a leading resource for credit card information and financial literacy, has released findings from its October 2024 survey of 1,500 Americans who hold at least one credit card.
The data reveals significant holiday-related spending trends and their impact on Americans' financial health, with many cardholders set to max out credit cards or open new accounts to manage seasonal expenses.
Key findings:
- Debt isn't stopping holiday cheer: Despite 53% of respondents carrying credit card debt—and 22% owing $5,000 or more—96% plan to keep spending on holiday purchases.
- Debt snowballs during the holidays: 1 in 3 credit card holders already in debt expect to go even deeper into debt this season.
- Maxing out becomes the norm: Nearly half of credit card holders will max out at least one card by the end of the holidays.
- Opening new cards to stay afloat: To cover holiday costs, 16% of respondents plan to open new credit cards, while 1 in 5 will take on store credit cards.
- A legacy of debt from last year: Holiday spending from 2023 is still haunting 25% of respondents, contributing to their current credit card balances.
Holiday Spending Adds to Debt Burden
Over half of credit card holders surveyed are carrying debt, yet 96% of those indebted plan to make holiday purchases in 2024. With 30% expecting to deepen their debt and 48% planning to max out cards, financial strain is on the horizon for many. Among those with existing balances, 55% anticipate maxing out at least one card, with 15% expecting to max out two and 4% planning to max out three or more.
"Before making holiday purchases, it's important to assess your current debt and interest rates to avoid compounding financial challenges," says John Egan, Insurance and Personal Finance Contributor for CreditCards.com. "Consider budgeting carefully and prioritizing thoughtful, low-cost gifts."
Americans Prioritize Gifts and Travel Despite Financial Struggles
Credit card debt holders are planning significant holiday spending, with 28% expecting to spend between $500 and $999 on gifts, 21% planning to spend between $1,000 and $1,999, and 9% anticipating they will spend $2,000 or more. Holiday travel expenses are also adding up, as 14% anticipate spending between $500 and $999, 11% plan to spend between $1,000 and $1,999, and 8% expect to spend $2,000 or more. Many of these costs stem from visiting family, which accounts for 51% of travel plans, while 38% combine family trips with vacation, and 11% travel solely for vacation.
New Credit Cards and Store Accounts Fuel Spending
This holiday season, 16% of credit card holders plan to open a new credit card. Among them, 65% are motivated by promotional rewards or cashback opportunities, while 56% aim to increase their available credit for seasonal expenses, and 21% are consolidating existing debt. Additionally, 20% of respondents plan to take out store credit cards to help manage holiday purchases.
Methodology: This survey was launched in October 2024 through the Pollfish platform. Qualified respondents were selected based on a screening question and demographic criteria. A total of 1,500 U.S. adults who hold credit cards were surveyed. Access the full report here: https://www.creditcards.com/statistics/half-of-us-credit-card-holders-will-open-or-max-out-cards-for-holiday-spending/
Media Contact
Jennifer Miller, CreditCards.com, 000-0000, [email protected]
SOURCE CreditCards.com
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