Which generation group has the fastest growing credit card debt?
Although Gen Xers hold the most credit card debt by generation, millennials' average balances increased the most, jumping by a little over 15% in the last quarter of 2023, compared with the last quarter of 2022. Gen Zers aren't too far behind with their balances increasing by around 14%.
Generation X has the most credit card debt among Americans. See where the other generations fall and who owes the least. If you're struggling to pay off credit card debt, you are far from alone: One in three Americans have more credit card debt than savings both in 2023 and 2024, a Bankrate survey shows.
Credit Card Debt Demographics
Among ethnicities, White, non-Hispanic populations had the highest credit card debt. Debt owed by this demographic totaled $2,500 more than Black, non-Hispanic populations. Hispanic populations owed an average of $4,150, the least credit card debt among all ethnicities.
While Americans of all ages are grappling with higher balances, Gen Z and millennials are seeing the largest average increases in total debt and the steepest decline in credit scores, according to data provided to Fortune by personal finance company Credit Karma on tens of millions of member accounts.
Credit card debt by household income
While having a credit card is less common for lower-income consumers, they are more likely to be carrying card balances. And about 50 percent of those with annual incomes of $25,000 to $99,000 carried a balance on their credit cards at least once in the previous 12 months.
But one generation carries the most, on average: Gen X. The average credit card balance for Gen Xers, defined at those between the ages of 43 and 58, rose to $9,123 in the third quarter of 2023, according to Experian's latest available data. That marks the highest average credit card balance of any generational cohort.
Gen X (ages 43 to 58) not only carries the most debt on average of all the generations, but is also the debt leader in credit card and total non-mortgage debt.
Across the different age groups in 2022, Gen Z, ages 18-25, had the lowest average credit card debt, at $2,854.
The average credit card debt held by Gen Z is $2,854, according to Q3 2022 data from the credit bureau Experian. This is the lowest average for any adult generation, which makes sense considering that people in Gen Z (ages 11-26) have had the least amount of time to rack up credit card debt.
While race cannot legally affect credit scores, credit score disparities still exist among various racial groups. The Urban Institute collected a series of statistics that indicate white communities have the highest median credit score at 727, which falls well into the good range on both FICO and VantageScore models.
Are Gen Z more financially literate?
According to the US National Association of Plan Advisors (NAPA), Gen Z has the lowest level of financial literacy, with only 28% of questions being answered correctly on average.
Americans — particularly Millennials and those with lower incomes — are becoming increasingly overextended financially: Credit card and auto loan delinquencies have not only surpassed pre-pandemic levels, they're the highest they've been in more than a decade.
More than half, or 53%, of Gen Zers say higher costs are a barrier to their financial success, according to a separate survey from Bank of America. In addition to soaring food and housing expenses, millennials and Gen Z face other financial challenges their parents did not as young adults.
Running up $50,000 in credit card debt is not impossible. About two million Americans do it every year.
What is the average credit score? The average FICO credit score in the US is 717, according to the latest FICO data. The average VantageScore is 701 as of January 2024. Credit scores, which are like a grade for your borrowing history, fall in the range of 300 to 850.
However, Gen Z's debt is rising rapidly, likely due to increased education costs, the financial impact of recent recessions, and high unemployment rates for this generation.
Data showed that people 35 or younger have the lowest average credit card debt at $3,700. Around 48% of individuals in this age group carry debt. Adults 75 or older have the highest average credit card debt at $8,100, but just 28% of people in this age group have debt.
| Generation | Average total debt (2023) | Average total debt (2022) |
|---|---|---|
| Gen Z (18-26) | $29,820 | $25,851 |
| Millenial (27-42) | $125,047 | $115,784 |
| Gen X (43-57) | $157,556 | $154,658 |
| Baby Boomer (58-77) | $94,880 | $96,087 |
$5,000 in credit card debt can be quite costly in the long run. That's especially the case if you only make minimum payments each month. However, you don't have to accept decades of credit card debt. There are a few things you can do to pay your debt off faster - potentially saving thousands of dollars in the process.
Women are stereotypically seen as irresponsible spenders, but the data doesn't back this up. According to a 2019 Experian study, men carry more debt than women across nearly all categories, including credit card debt — the study found that men have $125 more in credit card debt than women on average.
Why do millennials have more debt?
King said millennials' purchasing preferences and the soaring cost of living has led many into "a vicious cycle of taking on more debt." Many were "forced" to rely on credit cards and loans to meet their needs, adding to their "crippling debt pile."
A majority, 65%, say they live paycheck to paycheck, according to CNBC and SurveyMonkey's recent Your Money International Financial Security Survey, which polled 498 U.S. adults. That's a slight increase from last year's results, which found that 58% of Americans considered themselves to be living paycheck to paycheck.
“Shark Tank” investor Kevin O'Leary has said the ideal age to be debt-free is 45, especially if you want to retire by age 60. Being debt-free — including paying off your mortgage — by your mid-40s puts you on the early path toward success, O'Leary argued.
Gen X has the highest average debt balance in all categories, except for personal loans. Here's the breakdown: Credit cards: Gen X have the highest credit card balance compared to other age groups, at $8,215. Auto loans: Gen X have the highest auto loan balance, at $21,570.
On the FICO credit score range, a prime credit score is between 660 and 719. Borrowers with prime credit scores tend to pose relatively little risk to lenders and creditors. With a prime credit score, you may qualify for more favorable loan or credit card terms, interest rates and reward programs.
