Consumers take on more credit card debt this holiday
Every year, Hillary Lanier does her holiday shopping on credit, racking up debt that takes months to pay off. This season, the production planner said his total balance on four credit cards is in the five-figure range. “These are definitely higher prices,” he said.
Lanier, who buys gifts for her parents, grandparents, siblings, friends and co-workers, said it could take nine to 10 months to pay off the balance — just in time for next year’s holiday season. “I tried to be careful and stick to my budget, but it’s a very vicious cycle,” said the 32-year-old actress, who lives in Charlotte, North Carolina.
Hillary Lanier, 32, lives in Charlotte, North Carolina
Courtesy of Hillary Lanier
In fact, 37 percent of Americans have increased vacation debt this year, to an average of $1,223; This figure is up from $1,181 last year. Lending Tree. For parents, the amount was even higher, averaging $1,324. The site surveyed more than 2,000 U.S. adults earlier this month.
“Tariffs and higher prices continue to strain household budgets, and this strain is especially evident during the holidays,” Matt Schulz, LendingTree’s chief consumer finance analyst, said in a statement.
“Even sticking to the same shopping list from last year may now cost more,” she said. “People adapt wherever possible throughout the year, but many fail to cut back on holiday traditions, so it’s easy to see how these higher costs can translate into mounting debt.”
According to LendingTree’s findings, 63% of borrowers like Lanier expect it will take three months or longer to pay off their debt. About 41 percent of this season’s borrowers are still paying last year’s bills.
“Carrying a month or two of holiday debt is not that big of a deal,” Schulz said. “If you stretch that out from six months to a year or longer, that becomes significant because of how high interest rates are on credit cards today.”
Credit card interest rates currently average over 20%, according to Bankrate.
Consumer spending, lack of confidence
New data released Tuesday shows that consumers in general are becoming more pessimistic about their financial situation.
Conference Board Consumer Confidence Index In December, it dropped 3.8 points compared to the previous month to 89.1, falling to its lowest level since April, when Trump’s tariffs first came into force. The indicator of future expectations remained stable at 70.7, well below the level of 80, which is considered a signal of the coming recession.
Still, other data shows shoppers continue to flock to stores in the final weeks of the year; This points to a growing disconnect between consumer spending and consumer sentiment.
Consumer spending rose 3.5 percent in the third quarter after rising 2.5 percent in the second quarter, the Commerce Department said Tuesday. National Retail Federation to guess It is predicted that holiday spending will exceed $1 trillion for the first time and will increase by 3.7% to 4.2% by 2024.
Maximum credit card balance is $6,500
Meanwhile, Americans’ credit card bills continue to rise. According to TransUnion’s latest credit sector, the average credit card balance per consumer now stands at $6,523, up 2.2% annually. analysis reportFrom the third quarter of 2025.
Average loan balances also increased in November from the previous year, according to a separate report from VantageScore.
This indicates more consumers are accessing additional liquidity compared to last year’s holiday season, according to Susan Fahy, the credit score developer’s vice president.
