Americans collectively owe over $1 trillion in credit card debt. But one generation carries the most, on average: Gen X. The average credit card balance for Gen Xers, defined at those between the ages of 43 and 58, rose to $9,123 in the third quarter of 2023, according to Experian's latest available data.
Gen X and Gen Z have the highest and lowest credit card debt, respectively. Here's how to pay it off.
Which generation has the lowest credit score? As of 2023, the generation with the lowest credit score is Gen Z (18 – 26). That said, the generation with the lowest credit score is almost always going to be the youngest generation of adults.
Even better, just over 1 in 5 people (21.2%) have an exceptional FICO credit score of 800 or above, all but guaranteeing access to the best products and interest rates.
What is the highest credit score possible? To start off: No, it's not possible to have a 900 credit score in the United States. In some countries that use other models, like Canada, people could have a score of 900. The current scoring models in the U.S. have a maximum of 850.
"Shark Tank" investor Kevin O'Leary has said the ideal age to be debt-free is 45, especially if you want to retire by age 60. Being debt-free — including paying off your mortgage — by your mid-40s puts you on the early path toward success, O'Leary argued.
At the close of 2019, the average household had a credit card debt of $7,499. During the first quarter of 2021, it dropped to $6,209. In 2022, credit card debt rose again to $7,951 and has increased linearly. In 2023, it reached $8,599 — $75 shy of the 2024 average.
Peak earning years are generally thought to be late 40s to late 50s*. The latest figures show women's peak between ages 35 and 54, men between 45 and 64. After that, most people's incomes typically level off. Promotions favor younger people with longer futures*.
The average FICO credit score in the US is 717, according to the latest FICO data. The average VantageScore is 701 as of January 2024.
What age group uses credit cards the most? Adults aged 25-54 use credit cards the most frequently, accounting for 53% of their transactions.
Running up $50,000 in credit card debt is not impossible. About two million Americans do it every year. Paying off that bill?
One thing that improves with age is creditworthiness. A study of average credit scores by generation shows that every major demographic group has an average credit score that is better than the generation before it. And best of all is the so-called Silent Generation. This group includes people aged 78 and over.
$5,000 in credit card debt can be quite costly in the long run. That's especially the case if you only make minimum payments each month. However, you don't have to accept decades of credit card debt. There are a few things you can do to pay your debt off faster - potentially saving thousands of dollars in the process.
Gen X (ages 43 to 58) not only carries the most debt on average of all the generations, but is also the debt leader in credit card and total non-mortgage debt.
High-interest credit card debt can devastate even the most thought-out financial plan. U.S. consumers carry $6,501 in credit card debt on average, according to Experian data, but if your balance is much higher—say, $20,000 or beyond—you may feel hopeless.
There is no specific age to pay off your mortgage, but a common rule of thumb is to be debt-free by your early to mid-60s.
The Gen X debt situation
The cohort also has the largest share of people with debt, nearly 99% carry some type of balance, LendingTree found. Gen Xers led the way in three of the four categories analyzed. The group — between 44 and 59 years old — has the highest median credit card, auto loan and student loan balances.
That said, the typical age of financial independence should be between 20-23 years old, according to a Bankrate survey. Break the numbers down by cost category, and differences of opinion can be pretty wide.
There's no single, specific credit score that will automatically qualify you for a mortgage (though having the maximum score of 850 certainly never hurts). However, while lenders might not set precise qualifying numbers, they do have minimum credit score requirements.
Key Takeaways. Your credit score is a major factor in whether you'll be approved for a car loan. Some lenders use specialized credit scores, such as a FICO Auto Score. In general, you'll need at least prime credit, meaning a credit score of 661 or up, to get a loan at a good interest rate.
Overall, Credit Karma may produce a different result than one or more of the three major credit bureaus directly. The slight differences in calculations between FICO and VantageScore can lead to significant variances in credit scores, making Credit Karma less accurate than most may appreciate.