Credit card debt has hit a record $1.17 trillion

Americans' credit card debt continues to soar, reaching a new record at the end of September, according to a report released by the New York Federal Reserve.

During the third quarter, total credit card debt rose by $24 billion, climbing to $1.17 trillion, the highest level recorded in Fed data going back to 2003.

Household Debt on the Rise

The report also highlighted a broader increase in total household debt, which hit a new high of $17.94 trillion. This includes balances across major categories:

• Mortgages: $12.59 trillion
• Auto loans: $1.64 trillion
• Student loans: $1.61 trillion

Balancing Income and Debt

"Although household balances continue to rise in nominal terms, growth in income has outpaced debt," noted Donghoon Lee, Economic Research Advisor at the New York Fed. "Still, elevated delinquency rates reveal stress for many households, even amid some moderation in delinquency trends this quarter."

Delinquency Trends

Credit card delinquencies eased slightly last quarter, dipping from 9.1% to 8.8%, but remain higher than pre-pandemic levels. Meanwhile, delinquency rates for auto loans and mortgages worsened slightly, increasing by 0.2 and 0.3 percentage points, respectively.

Younger Borrowers Feeling the Strain

In a discussion following the report, New York Fed researchers expressed concern over the "persistent" growth in auto loan and credit card delinquencies, particularly among younger borrowers who are disproportionately affected by financial stress and high delinquency rates.

Amid rising inflation and interest rates, the growth in consumer debt highlights ongoing financial challenges for many Americans.