As inflation continues to rise, many U.S. workers borrow money just to get by, turning credit cards and loans into lifelines. A new report, shared by Zety, reveals the extent of this growing crisis, including the alarming reality of credit card debt statistics that experts refer to as “survival debt.”
The report found that more than half (56%) say their salary isn’t enough to manage debt and contribute to future savings. Additionally, 48% say they have relied on debt in the past year to pay for essentials like groceries and utilities. These financial pressures are forcing employees to make difficult trade-offs, from delaying retirement savings to cutting back on medical care, travel and even family planning.
The key findings reveal that credit card debt dominates and is the most common form of debt among employees, with 71% of workers carrying credit card balances. Credit card debt payments continue to add up and 1 in 5 (21%) say they can make only minimum payments on their debt.
While credit card debt leads, 37% of U.S. workers say they have mortgages, 30% carry auto loans, 23% are paying off student loans and 17% have medical debt or personal loans. As the report reveals, without structural changes to wages or other financial support, individual strategies alone are not enough to break the cycle of mounting debt.
Instead, Americans are making significant sacrifices to stay afloat financially. The study found that 44% of workers say they’ve postponed or skipped vacations, 41% have cut back on entertainment or dining out, 36% have given up hobbies or personal interests, and 24% have put off buying or upgrading a car. Notably, 22% of workers said they have delayed saving for retirement and 10% admit to skipping necessary medical care or prescriptions.
Only 30% of workers surveyed said they haven’t had to give up anything to manage their mounting debt.
“The pressure to make ends meet is forcing workers to adapt in ways that reach beyond their wallets,” the study said. “Decisions about health, family and long-term plans are increasingly influenced by the need to stretch resources, leaving many feeling trapped in a cycle of ongoing compromise.”
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