With Americans predicted to have more credit card debt by the end of the year, check out these tips on how to deal with it

It’s startling that many American families are dealing with more than $11,000 in credit card debt.

Credit card debt dropped by $61 billion in January 2025, falling to $1.3 trillion in February 2025, according to recent Federal Reserve data.

Despite the average credit card APR decreasing due to the Fed’s rate cuts last year, credit card debt will increase by $100 billion by the end of 2025, an analysis by WalletHub, a personal finance website, predicts.

Twenty-five percent of Americans expect to have more debt by the end of the year and 46 percent of them don’t have a plan for paying off what they owe, said John Kiernan, WalletHub editor and author of the credit card survey.

What people really need is a well-thought-out budget that maximizes debt payments, Kiernan said. For one in three Americans, their debt comes from nice-to-have expenses rather than must-have.

In addition, 14 percent of people are very stressed about their credit card debt. The average American household has $11,303 in credit card debt.

Additional key points from WalletHub’s “Credit Card Debt Survey” are:

• Tariff concerns: Nearly half of Americans are concerned that tariffs will make their credit card debt worse.
   
• Inflation a bigger worry: Almost three times more Americans are most worried about inflation compared to tariffs.
   
• No trust in AI: Nearly four in five people don’t trust AI for information about managing their credit card debt.
   
• Interest rate caps: 83 percent of Americans think the government should put a cap on credit card interest rates.
   
• National debt in worse shape: Nearly four in five people say the country’s debt is in worse shape than their personal debt.

WalletHub offers these five tips for dealing with credit card debt:

1. Separate everyday expenses from debt. When you carry a credit card balance from billing period to billing period, you lose your grace period for new purchases. That means interest starts applying to new purchases right away. But if you use one card for ongoing debt and another for everyday purchases that you can pay off by the due date, the everyday purchases should never accrue interest charges.  
2. Use a balance transfer deal to lower the cost of existing debt. The best balance transfer credit cards can give you a break from interest charges for as long as 24 months, and attractive offers are accessible to individuals with fair credit or better. A prolonged 0 percent introductory period can yield significant savings on interest, helping you get out of debt faster.
3. Use a rewards card for everyday spending. You can save 1 percent to 2 percent plus on every purchase with the right rewards card. You might also save a couple hundred dollars with an initial bonus. And if you plan to pay the bill in full monthly, the interest rate won’t matter.
4. Improve budgeting and saving efforts. Several good budgeting tools are available to consumers for free or a low cost. Taking ownership of your budget can help you free up some room for emergency fund contributions and debt payments so you can get out of debt and stay there.
5. Work to improve your credit score. People with higher credit scores tend to pay lower interest rates. For example, the average APR among credit cards for people with fair credit is 26.82 percent, while the average for people with excellent credit is 17.62 percent, according to WalletHub’s database of about 1,500 credit card offers. Having good or excellent credit also makes it easier to get credit cards with a 0 percent introductory APR.

Best wishes to us all in these trying economic times.