Wallet Hub Study – South Dakota posts Country’s 4th Smallest Credit Card Debt Increase
UNDATED – With inflation putting pressure on people’s budgets and raising concerns about a prolonged recession, U.S. consumers are once again adding new credit card debt by the billion, racking up $67.1 billion during Q2 2022, according to WalletHub’s latest Credit Card Debt Study, released today. That is an all-time record for credit card debt added during the second quarter of a year, and WalletHub now projects that consumers will add a total of $110 billion in debt during 2022.
This new debt is also likely to become even more expensive soon, with the Federal Reserve expected to raise its target rate by 75 basis points on September 21. WalletHub anticipates this will cost people with credit card debt an extra $5.3 billion over the next 12 months.
In addition, the rise in debt is not uniform across the country, as some areas have bigger payment problems than others. With that in mind, WalletHub compared all the states based on how much residents owe to credit card companies – specifically, how those balances changed in Q2. Please find key takeaways below, along with commentary from WalletHub experts (audio and video files included).
|States with the Biggest Debt Increase||States with the Smallest Debt Increase|
|New York||South Dakota|
For the full rankings, please visit:
Credit Card Debt Study Key Stats
- South Dakota Debt: The average household in South Dakota owes $7,152 in credit card debt, following a $488 Q2 increase.
- Record Q2 Increase. Credit card debt increased by almost $67.1 billion during Q2 2022, an all-time record for the second quarter of the year.
- Bigger-Than-Normal Buildup. Consumers’ Q2 2022 credit card debt increase was 3.5X bigger than the post-Great Recession average for a second quarter.
- Record Annual Projection. WalletHub projects that consumers will end the year with roughly $110 billion more in credit card debt than they started with, which would be close to an annual record.
Fed Rate Hike Survey Key Findings
- More Costly Debt. A Federal Reserve interest rate increase on September 21 would cost people with credit card debt an extra $5.3 billion in the next year alone. That’s on top of the $15.3 billion increase already caused by the Fed’s previous rate hikes this year.
- Inflation Concerns. 85% of Americans are concerned about inflation right now.
- Fed Increases Affecting Wallets. 63% of people say their wallets have been affected by the Fed’s rate hikes this year.
- Monthly Expenses Affected. 62% of people say inflation has affected their monthly grocery expenses the most, followed by gas (32%) and housing (6%).
- Government Intervention at the Pump. 71% of people think the government should put a cap on gas prices.
- Not Recession-Ready. 44% of people do not think they are financially prepared for a recession.
- High Inflation Preferable to High Unemployment. 56% of Americans say they would prefer high inflation over high unemployment.