The rule of 72 exposes the true cost of procrastination when it comes to credit card debt. Here's how it works.

Credit card debt is weighing on many Americans. The share of credit card holders making just the minimum monthly payment is at a 12-year high, a report shows.

Collectively, Americans now owe a record $1.21 trillion on their credit cards, according to a new quarterly report on household debt from the Federal Reserve Bank of New York. Credit card balances jumped by $45 billion in the fourth quarter of 2024, driven in part by holiday spending, and are now 7.3% higher than a year ago.

Bankrate Chief Financial Analyst Greg McBride says “more and more households [are] relying on credit to bridge that gap where the income stops but the expenses keep going.”

Americans Struggle With Record Credit Card Debt U.S. credit card debt reached a record $1.17 trillion in the third quarter of 2024, growing from $770 billion in the first quarter of 2021 and the share of active credit card holders making just minimum payments rose to 10.75%, the highest percentage ever in data going back to 2012. [ The Guardian]

Creditors cannot have you arrested for credit card debt, but they can sue you for payment. If sued and you do not respond, a default judgment may award creditors everything they’ve asked for and result in garnishment of your wages or other actions to recover their losses.

Following the trend of the last several months, Americans’ household debt has increased once again to new record highs, according to the Federal Reserve Bank of New York.