The extra cash from the pandemic is gone. Credit cards have taken its place.
By the end of 2025, card balances hit $1.28 trillion, per the New York Fed. That tops every past quarter in the more than 25 years they've kept track.
The rise from the pandemic low has been steep. Balances are up 66% from the bottom — back when stimulus checks and extra jobless pay helped clear cards.
That safety net is spent. And for a lot of families, the bills never stopped.
Here's the key number. Close to half of active cardholders — about 111 million — don't pay off their full bill each month.
They're making the lowest payments they can. And they're paying some of the highest rates ever seen in card lending.
Record balances times record rates means a monthly cost most borrowers have never seen. Every dollar going to interest is a dollar not going to a store or a meal.
Take-home pay — adjusted for what food, rent, and insurance really cost — hasn't kept pace with the price jumps of the past few years.
The gap between what people earn and what life costs is being filled with plastic. That can't last.
Younger borrowers and lower-income families are piling on debt the fastest and missing bills at the highest rate.
For context — card rates are above 20% right now. A consumer carrying a $6,000 balance and paying only the minimum could take more than 15 years to pay it off.
Late payment rates are the next key number. If the share of consumers falling behind keeps ticking up, it'll hit bank earnings first and retail spending second.
The bottom line: wealthy households spend from their gains. Everyone else is spending from their credit limit.
One of those has a ceiling.
