1 in 4 credit card debtors believes they will never be free of debt

As interest rates hover near record highs, millions of Americans are falling deeper into a financial rut they fear they’ll never escape: credit card debt.

According to a new Bankrate survey released July 16, 23% of people with credit card debt believe they will never get out of it. That sense of permanent financial strain is especially high among Gen X and baby boomers, while even younger generations are struggling to get ahead.

Why so many Americans are stuck in credit card debt

The backstory:

Bankrate’s new report paints a sobering picture of how many U.S. households rely on credit cards just to get by—and how long that debt lingers.

Nearly half of cardholders (46%) say they carry a balance month to month, down slightly from 48% in late 2024. But of those with debt, 60% have been in the red for over a year—up from 53% in the prior survey.

While credit card usage spans all income groups, it’s most prevalent among lower earners. Bankrate found that 56% of people earning under $50,000 carry a balance monthly, compared to 34% of those making over $100,000.

What we know:

Emergency expenses are the most common reason Americans go into credit card debt, according to the survey. That includes:

• Emergency car repairs (11%)
• Medical bills (10%)
• Home repairs (8%)
• Other urgent or unexpected expenses (16%)

Another 28% say everyday costs like groceries and childcare are to blame. Retail spending (11%) and vacations or entertainment (9%) also contribute.

What we don't know:

It’s unclear how much of this lingering debt is driven by inflation, stagnant wages, or rising costs of essentials like housing and healthcare—though those factors are frequently cited in other financial surveys.

We also don’t know how the growing use of buy-now-pay-later services or high-interest fintech products may be impacting long-term credit card debt accumulation.

What they're saying:

"Fewer than half (48%) of credit card debtors have a plan to get out of debt. This is alarming but not surprising," said Bankrate Senior Industry Analyst Ted Rossman. "Americans have trouble talking or even thinking about credit card debt. 

We need to take the stigma out of it. If you have credit card debt, you have plenty of company, and the causes are usually practical. But you can’t hide from it, especially since credit card balances and rates are near record highs."

Rossman also offered several strategies for tackling credit card debt, including balance transfer cards, nonprofit credit counseling, and side hustles to generate extra income.

By the numbers:

The survey reveals just how widespread and persistent credit card debt has become across age groups and income levels.

• 23% of credit card debtors say they’ll never get out of debt
• 60% have been in debt for over a year
• 27% are less confident now about escaping debt than they were last year
• 18% are worried they won’t be able to make minimum payments in the next 6 months
• 45% cite emergencies as the main cause of their credit card debt

What you can do:

Bankrate recommends a few steps to start breaking the cycle:

• Get a clear picture of what you owe by listing balances, rates, and minimums.
• Explore 0% APR balance transfer offers to slow interest accumulation.
• Create a monthly budget that prioritizes high-interest debt.

Seek help from nonprofit counseling services like Money Management International.