*Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any credit card issuer. This site may be compensated through a credit card issuer partnership.
This article was last updated Jan 22, 2019. Terms and conditions may have changed. For the most accurate information, please consult the issuer website.
Nearly two-thirds of credit cardholders expect to pay their monthly statement balance in full more often in 2019 than they did in 2018, according to a new survey from CompareCards.com.
That’s just one of several positive economic signs in this month’s CompareCards.com Credit Card Confidence Index. Every month, we ask credit cardholders to rate how confident they are in their ability to pay their credit cards’ monthly statement balance in full this month and six months from now, as well as tracking how often they’ve paid those balances in full in the past six months. In January, we supplemented our typical questions with a few that asked for cardholders’ expectations for 2019 as a whole. What we found was that American credit cardholders are getting more confident in their ability to pay off their credit card bills each month — a strong sign that Americans feel good about their finances as the new year begins.
(Note: When we asked these questions, the government shutdown was about two weeks old. It didn’t appear to have much, if any, impact on credit cardholders’ confidence at that point. What difference it’ll make if it lingers on several more weeks — or even months — obviously bears watching.)
- 63% of cardholders say they expect to pay their monthly card balances in full more often in 2019 than they did in 2018. (Just 7% say they’ll do it less often.)
- 70% of millennials expect to pay their credit card bills in full more often – the highest of any age group. (That includes 45% who say they expect to pay in full much more often.)
- The average cardholder expects to pay their monthly statement balance in full eight times in 2019.
- 48% of cardholders are very confident they’ll be able to pay their credit card statement balances in full this month — the highest in the five-month history of the survey. Just 18% are not at all confident.
- The percentage of cardholders who said they paid their entire monthly statement balance in full each of the last six months climbed to 39%, the highest since the survey began. It’s the third straight monthly increase. Meanwhile, 20% said they hadn’t paid their balances in full a single time.
The bottom line: This confidence level can’t last forever.
After looking at Confidence Index data from January and the past several months, one thing is certain: At the moment, Americans feel really good about their ability to pay their credit card bills.
The question, however, is how long this moment can last. The most likely answer, unfortunately, is not too much longer.
We’re living in volatile times. The economy is still strong, yet many expect a recession to emerge in 2019 or 2020. Unemployment is low and wage growth has begun to rise, yet we’re carrying more debt than any time in our history. The stock market has been a roller coaster ride. Credit card interest rates are at historic highs, though the Federal Reserve is likely taking their foot off the gas for a while when it comes to raising rates. Finally, the political landscape is as unpredictable as it has ever been, with no one quite knowing how long the current government shutdown will last and what it’s economic impact will be. (Again, this month’s polling was done when the government shutdown was about two weeks old.)
These are just a few of the reasons why Americans need to focus on paying down their credit cards and other types of debt in 2019. Yes, you may feel good about your ability to pay today, but you may be sacrificing future financial security to do so. That’s because if you’re paying down debt in good economic times, you’re probably not putting away as much as you should for when the economy isn’t so good. That means you’d make those future bad times even worse than they need to be, and that’s the last thing any of us want to do.