Bankrate’s 2025 Credit Card Debt Report

Here’s the kicker about credit card debt — as soon as it starts rolling down the hill, it gains momentum and size, thanks to interest. Unfortunately, it’s a slippery slope that many credit cardholders are on.

Credit card interest rates are some of the highest borrowing costs out there, currently averaging above 20 percent. When you carry a card balance, not only are you taking money from your future self, but you’re piling interest on top of interest.

The implications of credit card debt are far-reaching, from pausing major life decisions to feeling like you’ll never pay it off. But with the right tools, it’s possible to tackle your debt before it takes over.

Bankrate’s key insights on credit card debt

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Since 1976, Bankrate has been the go-to source for personal finance data, publishing average rates on the most popular financial products and tracking the experience of consumers nationwide.

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Nearly half of American credit cardholders still carry debt, mainly due to emergency costs

Lana Linge, 29 years old, has been through three cycles of credit card debt during the last decade. Most recently, she was in $40,000 of credit card debt spread across six cards.

Linge admits, in some ways, she was living beyond her means and spending to cope emotionally. But she was also laid off the year prior, and was still on the hook for mortgage payments, an emergency vet bill and everyday expenses like gas and groceries.

Linge is not alone — 46 percent of American credit cardholders carry a balance as of June 2025. That’s down slightly from 48 percent in November and 50 percent in June 2024, but still up from 39 percent in December 2021.

Linge never missed a credit card minimum payment. But eventually, she could no longer pay her bills. She cut up her credit cards and made the decision to file for Chapter 7 bankruptcy.

“When you view yourself as a pretty responsible individual, it can be very difficult to determine the fact that you have a part of your life that you have not been responsible in,” Linge says. She also shares that she grew up in a financially unstable household. At one point, they lost their home to foreclosure.

Moving forward, Linge says she aspires to not end up in this situation again — by checking her finances daily and changing her mindset around money.

Americans have trouble talking or even thinking about credit card debt. We need to take the stigma out of it. If you have credit card debt, you have plenty of company, and the causes are usually practical. But you can’t hide from it, especially since credit card balances and rates are near record highs.

— Ted Rossman Bankrate Senior Industry Analyst

Fewer Americans carry credit card debt, but Gen Xers and millennials lead the pack

The number of American cardholders with credit card debt — 46 percent — has dropped four percentage points since this time last year.

Even so, more than half of Gen Xers (ages 45-60; 55 percent), about half of millennials (ages 29-44; 49 percent), more than 2 in 5 boomers (ages 61-79; 44 percent) and more than 1 in 3 Gen Zers (ages 18-28; 35 percent) with credit cards carry a balance from month to month.

• Lower-income cardholders and women are more likely to have credit card debt

• Some credit card debtors feel doomed

• More debtors carry a balance for at least a year

• Emergency and day-to-day expenses are the most common reasons for credit card debt

Credit card debt puts people’s lives on pause

Nearly 2 in 3 U.S. credit cardholders with debt (64 percent) say they have delayed or avoided financial decisions because of their credit card debt, according to Bankrate’s 2025 Dealing With Debt Survey.

Saving for an emergency (34 percent), investing (23 percent) and buying a vehicle (21 percent) are the most likely to be set back.

Credit card debtors also say they’ve put off helping family and/or friends (19 percent), donating to charity (17 percent), spending on wellness (17 percent, e.g., gym fees, weight management programs, meal delivery services), spending on healthcare (17 percent, e.g., medical procedures, medication) and making home purchases (13 percent).

And when it comes to major life choices, debtors have delayed continuing education and/or job-related training courses (8 percent), different and/or new employment (7 percent), having children (5 percent) and getting married (5 percent).

Missing these milestones shows that credit card debt can hold you back. “This is why it’s so important to pay off your credit card debt as quickly and cost-effectively as possible,” Rossman says.

• Younger generations are more likely to delay financial decisions because of debt

• Most credit card debtors admit that debt impacts their financial choices

4 steps to take toward paying off credit card debt in 2025

Here are a few stepping stones toward managing your credit card debt this year. The sooner you can get ahead of your debt, the less you’ll have to fork over in interest fees.

• Include debt repayment in your budget

• Apply for a balance transfer card

• Consider a debt consolidation loan

• Work with a credit counselor

The bottom line

With so many credit cardholders in debt, it’s clear that Americans face tough financial circumstances. But it’s imperative to have a plan for debt payoff before interest gets out of control. Debtors might consider signing up for a balance transfer card, working with a reputable nonprofit credit counselor and adjusting their income and expenses to leave room for repayment.

“None of this needs to last forever, but buckling down for a period of time and knocking out your credit card debt can do wonders for your overall financial situation,” Rossman says.

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