New Study Shows Americans’ Debt Level Climbing While Savings Dwindle

Credit card debt in America continues to climb, according to a new study. Meanwhile, savings accounts are emptying out or sitting idle, in a trend that has finance experts concerned.

Fifty-two percent of Americans say they still have more money in their savings accounts than they have in credit card debt. That percentage is unchanged from 2016. But the number of Americans with more credit card debt than savings is climbing, rising two percentage points from last year to this year. Only one in six Americans say they don’t have either credit card debt or emergency savings – a worrying statistic, considering those people could very easily fall into debt with just one unplanned expense.

Savings and debt: the generational divide

Older folks – Baby Boomers and their parents, the so-called Silent Generation – were more likely to have substantial savings and less credit card debt. Millennials and Generation Xers were most likely to have more debt than emergency savings overall, but perhaps surprisingly, older Millennials (those ages 27-36) were less likely than Baby Boomers to have more debt than savings.

The age group most likely to have neither debt nor savings was the Silent Generation. These folks, who are age 72 and older, often live on a fixed income such as a pension, or Social Security. If they suddenly encounter a situation where they need extra funds, they might be in a pinch.

Income, debt, and savings

It might stand to reason that folks who make the least money have the most debt and the least savings. But this did not prove to be true, according to the survey. It wasn’t the lowest earners, but the lower middle-income earners, who were more apt to have greater debt than savings. These households, earning between $30,000 and $50,000 a year, had the greatest debt to savings ratio in the survey.

Lower income households, like older folks, were more likely to have no debt, but also no savings.

The survey was conducted by Princeton Survey Research Associates International, and interviewed 1,000 adults throughout the continental United States. Interviews were done by telephone, both landline and mobile phone, in both English and Spanish.