The average American has more than $15,000 in credit card debt, according to data released yesterday by NerdWallet. Including mortgages, the average household has more than $131,000 of debt.
Spending more than they can afford on unnecessary purchases is the top reason why people have credit card debt, according to the study. After that, paying for non-medical emergencies, paying for necessities not covered by household income, and paying for necessities during a period of unemployment are the next most common reasons why individuals use their credit cards.
The spending category that has increased the most during the past decade are medical expenses, according to the report. Medical expenses have increased 34% during that period, outpacing all other categories and growing faster than household incomes, which have risen 20% in the past 10 years.
Self-Employed individuals are carrying the most amount of credit card debt, like due to irregular incomes.
If people didn’t have credit card debt, they would use the money to save for emergencies (57%), save it for a future goal (50%), or pay down other forms of debt (33%), according to NerdWallet.
Less than 20% of those surveyed said they pay their credit card balances in full every month. From the report:
More Americans who have been in credit card debt say they usually pay/paid whatever amount of money they have left over at the end of the month after all necessary expenses have been paid (26%) or a flat amount they have designated toward their debt (26%), the survey found. Less than a quarter (23%) said they typically pay/paid only the minimum amount due.
