Have a debt of $11,500 on a credit card today can make you hundreds of dollars a month in interest alone. With rates close to 24%, paying this debt only with minimum payments can extend it for years, unnecessarily.
The data is confirmed by the New York Federal Reserve: the entire debt on cards reached $1.28 billion to the last quarter of 2025, the highest level since 1999. Therefore, many families that use their cards to cover basic expenses such as food or gasoline are only increasing the cost of a debt that will be difficult to pay off.
A record that worries financial experts
Total credit card debt grew $44,000 million in just three monthswith an increase of 5.5% compared to the previous yearaccording to the New York Fed.
In 2021, during the pandemic, the total debt of $770,000 million. That is, in this period it rose in 66%, basically because prices skyrocketed after the pandemic and salaries were not enough to cover this increase.
The number that explains why it is so difficult to get out of bank debt
With an average rate of 23.7% annuallya person with a balance of $5,000 on your card and that you pay only the minimum you would pay approximately $1,900 in additional interest to pay off that debt in 36 months, according to LendingTree.
Michele Ranerivice president of research at TransUnion, indicated in December 2025 that “consumers are carrying very high levels of debt and paying extremely high interest.” And he warned: “we are in an unprecedented situation that continues to worsen month by month.”
111 million people can no longer pay
An analysis of The Century Basis and the organization Protect Borrowers March 2026 revealed that approximately 111 million people (around 40% of the entire adult population of the country) have outstanding balances on cards, a 17% more than five years ago.
A third of those people have had to delay a medical procedure to cover their payments. For many middle-income Hispanic families, these levels of debt are pushing them to ask for more credit to cover what the previous one can no longer pay.
What you can do right now
There is no instant solution, but these actions reduce the financial cost of an existing debt:
- Balance transfer: Several cards offer 0% introductory APR for 12 to 21 months. Changing your balance can save you hundreds in interest while paying down principal.
- Pay more than the minimum: Doubling the minimum payment can cut the time to pay off the debt and your entire interest cost in half.
- Prioritize the card with the highest rate: If you have several debts, pay off the one that charges the most interest first, to save the most money for this concept.
- Negotiate with your bank: Many institutions have hardship programs that temporarily reduce the rate. They are not announced, but they exist and are useful for these cases.
Frequently asked questions (FAQs) about card debt in the US
How much does the average household owe on credit cards in 2026?
According to the New York Federal Reserve, the average household owes approximately $11,500, with an interest rate of 23.7% annually, almost double what was paid in 2013.
Why does debt continue to rise when analysts say the economy is improving?
Because basic prices remain high and salaries have not recovered. Millions of families use the card to cover essential expenses. The credit is covering an income gap.
What is a balance transfer and how can it help me?
It is moving your debt to a card with a 0% introductory rate for 12 to 21 months. During that time, each payment in the prick rate of principal, not interest. It can save you between $500 and $1,500.
How do I know if I am paying too much in interest?
Check your account statement: it should indicate how long it would take you to pay off the debt by paying only the minimum. If it says more than 5 years, interest is eating up most of your payment.
Conclusion
The $1.28 trillion debt is due to the accumulation of years in which expenses grew faster than income and cards have filled that gap. As long as rates stay above 23% and prices don’t let up, that number will continue to rise.
The bigger question is whether the balance in your own portfolio is already costing you more than it is yielding. Reviewing it today is cheaper than ignoring it for another month, when the debt may become unaffordable.
Keep reading:
– How to build credit in the US from scratch if you have no history in 2026
– If your credit card has already damaged your history, this is what you should do today to stop losing money
– What happens when you pay off $5,000 of your credit card debt in one go