AARP: Nearly Half of Older Americans With Credit Cards Use Them for Purchases They Can’t Afford
Written by
Vance Cariaga
Edited by
Jenna Klaverweiden
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One of the biggest financial challenges those in retirement face is living on a fixed income. With no work bonuses or raises to give their bank account a boost, they can run into serious problems when they get hit with unexpected expenses or rising prices. Those problems include using credit cards to pay for everyday budget items.
A new survey from AARP found that 47% of adults ages 50 and older with credit card debt use credit cards to cover living expenses they can’t afford out of pocket. Almost one-fifth (17%) needed credit cards to cover basic expenses every month over the last year.
Here are more details on credit card debt in America and how it’s affecting older Americans specifically.
Credit Card Debt Is Rising
Higher credit card debt is not restricted to older Americans.
Credit card debt in the U.S. amounted to $1.211 trillion in the fourth quarter of 2024, according to Federal Reserve data cited by LendingTree. That marked an increase from the third quarter, which saw $1.166 in credit card debt. Additionally, that $1.211 trillion is the largest debt balance seen since the figure started being tracked in 1999.
Additionally, for cards accruing interest, the average interest rate is 22.8%, per LendingTree. A high interest rate like that can make it even harder to get ahead of debt.
How Does Credit Card Debt Affect Older Americans?
The AARP survey found that more than one-third (37%) of older adults with credit card debt report higher balances than a year ago. Of the older Americans who carry credit card debt month to month, almost half owe $5,000 or more, while 28% owe $10,000 or more.
Additionally, the survey found that 87% of respondents cited unexpected expenses as a problem that affects their credit card debt. Medical expenses, like dental care, prescriptions and vision care, were another factor.
High credit card debt is especially risky for seniors because they don’t always have the means to get it under control — such as a steady income.
“Credit card debt can jeopardize retirement security. For many retirees, who often live on a fixed income, it’s a real challenge to pay down debt without significant trade-offs,” Indira Venkat, AARP senior vice president of research, said in a March 10 press release.
How Older Americans Can Pay Off Credit Card Debt
While paying down credit card debt — especially in retirement — is no easy feat, there are steps older Americans can take.
According to the National Council on Aging, older adults can reach out to their credit card companies to try to negotiate new terms. Doing so could help them get a better interest rate, which will make paying down the debt easier. Older adults can also consider a debt management plan or credit counseling.
Additionally, those in or nearing retirement can consider a balance transfer credit card or a personal loan, per Fulton Bank.
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