The average credit card debt in America would seem like an easy figure to find, but it’s not so simple. Very often the information gathered is based on balances, which is different than debt. After all, some consumers pay off their balances in full while others just make the minimum payment. And averages are just that – averages – which means that consumers with very high balances can skew the numbers significantly.
However, there are some interesting facts about credit card debt that give us some insight into what consumers are dealing with. According to the Experian Intelliview tool, for example, the average credit card balance per consumer was recently reported to be $3,779.*
Average balances vary quite a bit, depending on how strong a consumer’s credit score is. For example, those with the best credit scores – “A” in the VantageScore range – carried an average balance of $1,749, followed by “B” credit scores at $2,764, “C” at 5,922 and “D” at $5,965. Those with the lowest scores – “F” in the VantageScore range – actually carried a little less debt that the “C”s and “B”s. Their average balance was $3,962; perhaps because they find it harder to get credit.
Some consumers would be thrilled with a $3,000 – $5,000 balance. Instead, they carry significantly more debt than that. For example, Cambridge Credit Counseling, a non-profit organization that helps consumers get out of debt, reports that consumers who sought their services owed an average of $18,643.17 on all their credit cards.** Again, that’s an average: some owed less and some owed a lot more.
How Does My Debt Compare?
If you are in debt, then no doubt you are wondering whether you are better or worse than other people. How does your debt compare? One easy way to find out is to use Credit.com’s free Credit Report Card. Along with a free credit score, you’ll see how much you owe – and see how that compares to other consumers.
More importantly, you’ll get helpful information on how to tackle your debt and start paying those balances down.
Getting out of debt – especially credit card debt – can not only save you a lot of money in interest charges but may also be good for your credit score. One of the factors that credit scoring models look at is how close you are to your credit limits on your revolving accounts, such as credit cards. The closer you are to your limits, the more that factor can negatively impact your credit scores. (For reference, FICO reports that consumers with the highest credit scores use about 10% of their available credit.)
*Experian Intelliview tool statistics as of first quarter 2013.
**As of 2nd quarter 2012.
More Interesting Facts About Credit Card Debt
Every three years, the Federal Reserve publishes its Survey of Consumer Finances based on detailed surveys of American families from all walks of life and income levels. That report*** offers some interesting credit card debt statistics:
Overall, 39.4% of families held credit card balances. Not surprisingly, 47.4% of couples with children reported they had credit card balances and comprised the largest group with credit card debt. While those who were single with no children age 55 and older were the least likely to carry balances at 26.9%.
Consumers with the highest income also reported carrying the largest amount of credit card debt. The median reported balance for those in the lowest percentile of income was $1,000 while the median balance for those in the top percentile of income was $7,900. (Remember that median means half were above and half were below.)
When looking at educational backgrounds, the largest median credit card balance reported was $4,200 for those with a college degree. while those with no high school degree reported a median balance of $1,600.
The largest median balances held belonged to those in age 35-54 ($3,500), followed by 55-64 ($2,800), 65-74 ($2,200) and age 75 or more ($1800). Surprisingly, those younger than 35 reported the smallest balances at a median $1,600.
***Changes in U.S. Family Finances from 2007 to 2010: Evidence from the Survey of Consumer Finances; Federal Reserve Bulletin, June 2012 Vol 98 No 2.