Nearly half of all credit-card users say they’re carrying debt each month — and 60% of people with credit-card debt have owed money for at least a year, according to a new report from Bankrate’s CreditCards.com.

While credit-card balances slid during the pandemic, driven in part by a decline in credit-card purchases in the earlier days of COVID-19 and the stimulus checks that helped people pay down their debts, those days are well over. Now, consumers are left to cope with the highest inflation in 40 years. 2022’s second quarter saw the largest cumulative increase in credit-card balances in more than 20 years when compared to the year prior, researchers from the Federal Reserve Bank of New York said last month.

At the same time, it’s becoming pricier to carry credit-card debt. As the Federal Reserve raises its benchmark interest rate to rein in rising prices, the annual percentage rate (APR) on new credit-card offers is surging to heights not seen in decades. 

“Even though Americans’ total credit card balances are down 4% from late 2019, according to the New York Fed, our data is further evidence of the K-shaped economy,” Ted Rossman, a senior industry analyst at Bankrate, said in a statement. ”While many people are doing better, sadly, many others are doing worse.”

‘I think it shows how high inflation and higher interest rates are making credit card debt into an even more persistent problem.’

— Ted Rossman, senior industry analyst at Bankrate

The CreditCards.com report used data from a commissioned YouGov online survey, which polled a sample of 2,419 adults, including 1,834 credit-card holders, from Aug. 24 to Aug. 26. It found that a year ago, 50% of those with debt had been in the red for at least a year, compared to 60% today. In 2020 and 2019, meanwhile, 56% of people with credit-card debt had owed money for at least a year, Rossman told MarketWatch in an email.

“I think the 50% figure from last year was artificially low because so many people paid down credit card debt during the pandemic (with stimulus funds, because they were spending less on travel and entertainment, etc.). But now it’s 60% — the highest among those four years,” Rossman said in an email. “I think it shows how high inflation and higher interest rates are making credit card debt into an even more persistent problem. And while we’re thankful that the pandemic has gotten better and more people are traveling and dining out, these expenses can create cost pressures as well.”

Rossman’s tip for people struggling with credit-card debt was to get a 0% balance transfer card, which can come with promotions that pause “the interest clock for up to 21 months.” Rossman said that “can be a tremendous tailwind for getting out of debt relatively quickly while saving hundreds, maybe thousands, of dollars in interest.”

People across the income spectrum are feeling the pain of credit-card debt, the report showed. Fifty-nine percent of cardholders earning $50,000 or less in household income each year held credit-card debt, while close to half of people earning up to $99,999 each year were similarly in the red, according to the report. Even 37% of cardholders with household incomes above $100,000 carried balances from month to month, the report said. 

Nearly half of debtors said an emergency expense — like paying for an unexpected medical bill, home repair or car repair — had led to their higher balance, according to the report. But troublingly, almost a quarter of credit-card debtors said their issue was with basic day-to-day expenses, like groceries and child care. And that issue was most acute for millennials.

“Thirty-one percent of millennials with credit card debt said their day-to-day expenses are the primary cause of their credit card debt, followed by 26 percent of Gen Zers, 24 percent of Gen Xers, and 20 percent of boomers,” the report said.