US Credit Card Debt Nears Record High at $1.26 Trillion in Q2

Credit Card Debt Approaches Record

Credit card debt in the United States reached $1.26 trillion in the second quarter of this year, marking a $21 billion increase. This data, released by the Federal Reserve Bank of New York, indicates that outstanding credit card balances are now close to the all-time record of $1.28 trillion established in the fourth quarter of the previous year.

Factors Contributing to Rising Debt

Economists attribute the increase in credit card debt to strong consumer spending and rising prices, particularly for essential goods like groceries and gas. These factors combine to place financial pressure on households, leading to greater reliance on credit.

The New York Fed's report, based on anonymized Equifax credit report data, also noted that while overall household debt stands at $18.8 trillion, auto loan debt specifically hit a new record high of $1.71 trillion. Conversely, student debt and mortgage debt saw decreases during the same period.

Increase in Delinquency Rates

A significant concern highlighted in the report is the rise in credit card delinquency rates. The percentage of credit card balances more than 90 days past due increased from 7.6% to 12.8% between mid-2022 and early 2026. Researchers from the New York Fed indicated that many households live paycheck to paycheck, making them vulnerable to delinquency if unexpected financial events occur. However, they also noted that higher delinquency rates are often linked to older outstanding debts rather than new charges.