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Experian study finds rise in U.S. credit card usage

Summary

Learn about the trends in credit card debt, scores and usage and what’s affecting them.

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U.S. credit card usage is increasing, according to the results of a recent survey by credit reporting agency Experian.

Compare Low Interest Credit CardsThe survey showed that the typical U.S. consumer has four credit cards, on average, compared with 3.2 credit cards in 2004.  Also, 51 percent of consumers who have established credit carry two credit cards.  Meanwhile, 14 percent of Americans have over 10 credit cards, up from the 10 percent of consumers that had over 10 credit cards in 2004.

That last group overlapped at times with the 14 percent of cardholders who use more than 50 percent of the credit available to them.  Those individuals that use over 50 percent of their credit lines hold an average of 6.6 credit cards, compared with five credit cards in 2004.  Still, despite increases in credit card use, the 14 percent of Americans using 50 percent or more of their available credit was down from 16 percent in 2004.

Experian said the average national credit score was down to 674 from 678 in 2004.  Nevertheless, the average score for U.S. consumers using at least 50 percent of their credit rose to 645 from 631 in 2004.

Experian found that Hawaii and Alaska are the two U.S. states with the largest numbers of residents maxing out their credit cards.  In those two states, 17 percent of residents use over 50 percent of their available credit.

The Consumer Credit Counseling Services of Hawaii partially attributed that high credit usage on the islands to the housing boom of slightly more than a year before.  Hawaiians who barely qualified for mortgages, but were able to get adjustable rate mortgages or 100 percent financing, are now experiencing a jump in their rates at the same time payments are due.  In certain cases, consumers are using their income to pay off mortgages and paying for staples like food and gas with credit cards.

On the other side of the country, Experian found that New Jersey and New Hampshire have the highest percentage of residents with at least 10 credit cards.  In New Jersey, 20 percent of consumers have over 10 cards, while 20.3 percent of New Hampshire consumers carry that many cards.

Interestingly, New England has both the heaviest use of credit cards and the highest credit scores, with the average New Englander carrying five credit cards and maintaining an average credit score of 651 for those using over half of their available credit.  An Experian analyst concluded the New Englanders must be paying their bills on time, thus keeping their credit scores safe, as opposed to usual case where higher credit utilization corresponds with a lower credit score.

Meanwhile, the average Southwestern resident holds 3.3 credit cards, while those in the Pacific and Mountain regions hold 3.9 cards.

Experian conducted the study by randomly choosing and analyzing 3.2 million of the approximately 215 million credit files in the company’s massive database.

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Credit Card Rate Report Updated: October 21st, 2020
Business
13.91%
Airline
15.50%
Cash Back
15.85%
Reward
15.75%
Student
16.12%

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