A recent survey conducted by Debt.com sheds light on the escalating financial challenges confronting American families, with a significant number resorting to credit cards for basic necessities. The 2025 Credit Card Survey indicates that 37% of Americans regularly use credit cards to cover essential expenses, a clear reflection of the inflationary pressures affecting the economy. This trend is further exacerbated by the finding that 32% of respondents have maxed out their credit cards, and 44% are carrying larger monthly balances than before, directly attributing this to inflation.
The survey, which polled 1,000 adults, reveals generational disparities in credit card usage, with Millennials and Gen Xers more likely to have maxed out their cards compared to Gen Z and Baby Boomers. Over 63% of participants currently carry a credit card balance, with more than 20% owing in excess of $10,000. The situation is particularly dire for those with maxed-out cards, 80% of whom would still turn to credit in the event of a financial emergency, underscoring the fragile financial state of many households.
Amid these findings, a bipartisan legislative proposal by Senators Alexandria Ocasio-Cortez and Anna Paulina Luna seeks to cap credit card interest rates at 10%. Howard Dvorkin, CPA and Chairman of Debt.com, highlights the significance of this measure, especially given that 27% of survey respondents are unaware of their credit card's Annual Percentage Rate (APR). This lack of awareness, combined with the reluctance of 57% of respondents to explore debt relief options like credit counseling or debt consolidation, points to a critical gap in financial literacy.
The survey's results are contextualized by recent consumer sentiment data from the University of Michigan, which shows a decline in confidence due to economic uncertainty, persistent inflation, and high borrowing costs. As households continue to grapple with these challenges, the survey underscores the urgent need for enhanced financial education and proactive debt management strategies to navigate the current economic landscape effectively.
