watch now4:3604:36Consumers' debt dilemma: Here's what to knowSquawk BoxAs credit card debt ticks higher, there are more signs that consumers — even those with higher incomes — are struggling to manage their balances.Credit card debt hit $1.21 trillion in the second quarter, in line with last year's all-time high, according to the Federal Reserve Bank of New York.
The total is up 2.3% from the previous quarter.While lower-income Americans are most ly to struggle with the higher costs of everyday items, a new set of surveys from the National Foundation for Credit Counseling found that over the past six months, debt issues have been affecting a growing number of Americans across all income levels."It really doesn't matter on the income level," said Mike Croxson, CEO of the NFCC, an organization of non-fit credit counseling agencies.
"It's really the debt level.
Because when you reach the tipping point that the interest expense exceeds what you can afford to pay, that's what gets the consumer into trouble."The NFCC survey of 2,010 U.S.
adults aged 18 and older, conducted by Harris Poll, was released in April, then d after a -up survey of 2,089 individuals in early August.'Negative debt behaviors' cross income levelsPoultry is displayed at a store in New York City, U.S., July 15, 2025.
Jeenah Moon | ReutersThere are several signs that consumers' debt struggles are getting worse.While the percentages are relatively small, the NFCC survey shows the of individuals who made a credit card payment in the last six months that was less than the required minimum rose to 13% in August, up from 8% in the spring.There was a similarly small increase in those who transferred debt from one card to another.
The of borrowers who consolidated credit card debt into a personal loan doubled, from 4% in the April survey to 8% in the August survey.The of those who engaged in some of these "negative debt behaviors" in the past six months was generally the same across income levels, from those earning less than $50,000 a year to those with annual incomes over $100,000, said Kathy Steinberg, a vice president at Harris Poll, in an ."Those in higher-earning households are less ly to be more worried various aspects of their finances compared to six months ago," but still, they "express concern," Steinberg said.
Compared to six months ago, 30% of high-income consumers in the August survey are now more concerned having enough money to cover unexpected expenses, and 20% are now more worried making timely debt payments, she said.
Other signs of debt strainOther data indicate that borrowers are increasingly falling behind on their payments, including those who are more than 90 days late.
The July CreditGauge report by the credit scoring company VantageScore shows that late-stage credit delinquencies increased year-over-year across all credit tiers, including among the most credit-worthy borrowers."There are a number of things that are driving that," said VantageScore CEO Silvio Tavares.
"The employment environment that's worsening, and we're seeing that in late payments.
But the reality is another trend, that's been going on for some time, is inflation and sustained high interest rates.
Those are the other key drivers of that change." More from Your Money:Here's a look at on how to manage, grow and tect your money for the years ahead.Trump’s new tax law expands 529 savings plan usesWhat private assets in 401(k) plans mean for investorsWhy on-time debt payments aren’t a magic credit score fixMeanwhile, the Federal Reserve's Senior Loan Officer Opinion Survey from July found lenders have been tightening standards on credit card loans in the past several months.Rising delinquencies and economic uncertainty are impacting lenders' decisions, Tavares said.He also noted that consumer demand for mortgages and car loans has fallen in recent months."Consumers who take out mortgage loans and auto loans tend to be higher income, more affluent.
Obviously, those are big purchases, and we're seeing them really throttle back their demand for those," said Tavares.Payments may be out of reach, even for higher-income consumers, he said.Around 15% of people buying or leasing a new vehicle have a payment of more than $1,000 a month, according to a new Experian report.
The average monthly payment for a new auto loan is $749. : Money 101 is an 8-week learning course on financial freedom, dered weekly to your inbox. here. It is also available in Spanish.