New Money Study: How the Pandemic Is Changing Americans' Credit Card Habits, From Spending to Paying Down Debt
Key Highlights:
- 70% of Americans said they have no plans to cancel or close an existing credit card as a result of the pandemic, and 38% of credit card users say it’s the only way they ever make a purchase right now.
- Even with the total debt declining, 11% of Americans said they were “very stressed” about credit card debt as of September — more than any other type of debt, including mortgages, medical debts, or loans.
- 29% of credit card users said they’re using their credit cards more than they were pre-pandemic, particularly when it comes to food and self-care items (e.g. toothpaste).
- City dwellers were more likely to say they’re leaning on credit cards more now than they were pre-pandemic (39%), compared to suburban residents (25%) or rural residents (22%).
Americans are using their credit cards regularly despite the coronavirus pandemic that has engulfed the country this year, according to a recent survey by Money and Morning Consult. But they’re paying down debt and using their cards differently.
In March, when COVID-19 was declared a pandemic, American wallets took a hit. Uncertainty caused markets to plummet, entire industries came to a standstill, and within that first month more than 22 million Americans filed for unemployment for the first time. The consumer confidence index — a measure of consumer optimism, based on saving and spending patterns — hit a six-year low in April.
That figure is starting to regain its footing, with September numbers indicating that American consumers are more willing to spend now than any month since March. But they're not nearly at pre-pandemic levels just yet, as Americans continue to cope with job loss, pay cuts, and general economic uncertainty.
In order to understand how the pandemic has shaped our spending behaviors, Money and Morning Consult surveyed 2,200 U.S. adults from September 8-10, about their credit card usage and debt over the last six months, focusing on debt accumulation and psychological stress.
Nineteen percent of the respondents surveyed said they’ve been laid off or lost a job since February 15, 2020, and 33% said they have lost pay or income. At the time of the survey, 27% said they don’t own a credit card, with a little over half saying they own two or more. Half of those surveyed had a credit score of 660 or more.
Here’s how the pandemic has impacted America’s relationship with credit cards.
Top-line Results: Credit Card Debt During the Covid-19 Pandemic
