What’s The Average Credit Card Debt In America?

The stereotypical image of the American consumer portrayed by the media is that of a family with a jumbo mortgage and drowning in consumer debt.  But is that the reality?  Americans certainly devote a far larger percentage of their income to mortgage payments than is wise, but the average credit card debt in America isn’t quite as bad as they make it out to be, at least not from my perspective.

The Average Credit Card Debt In America

At the end of 2008, the average credit card debt in America per household, regardless of whether or not they actually held a credit card, was $8,329.  Obviously, since not every household has a credit card, this average is less than useful.  The average credit card debt in America of households actually possessing a credit card was significantly higher:  $10,679, up from $10,637 the year before.

Here are some more credit card facts I found interesting and that really drive home our addiction to credit:

• Total outstanding credit card debt owed by Americans was $972.73 billion in 2008, up 1.2% from the 2007 total.
• Average balance per open card was $1,157.  Remember that many households own more than one card (I have three, unfortunately).
• 13.9% of our disposable income went to pay consumer debt.
• 73% of American households possess at least one credit card.
• Anchorage, Alaska has the highest average credit card debt in America per household.  Lincoln, Nebraska has the lowest.

Are Current Credit Card Debt Levels Worrisome?

The actual amount of the average credit card debt in America doesn’t worry me.  While $10,679 is a lot of money, it’s not an obscene amount and eliminating that amount of credit card debt is manageable for most households.  What worries me more is the fact that 13.9% of America’s disposable income goes directly to the credit card companies’ top lines.  With the average credit card rate hovering around the 15% mark, it takes a surprisingly little amount of accumulated debt to start generating sizable monthly debt obligations.

With consumers already facing reduced incomes and greater uncertainty due to the recent recession, it’s hard to imagine us being able to afford to spend our way out of this mess.  Certainly not if we are spending almost 15% of our disposable income paying for stuff we’ve already bought.  At the end of the day, just how much will be available for future purchases?  Not much, I’d wager.

Source:  Credit Card Statistics, Industry Facts, Debt Statistics