Credit Card Balances Fall Sharply to Start 2026, But Rebound Expected
By CU Today Staff —
MIAMI--U.S. consumers likely paid down a significant amount of credit card debt during the first quarter, with WalletHub projecting a $61-billion decline on an inflation-adjusted basis when the Federal Reserve releases updated consumer credit data Friday afternoon.
According to WalletHub’s forecast, the first-quarter reduction would be about 6% larger than the debt paydown recorded during the same period in 2025. Total credit card debt is projected to stand at approximately $1.35 trillion after adjusting for inflation, roughly 14% below its all-time high. The average household credit card balance is expected to be about $11,152, or $2,263 below the record level.
Despite the improvement, WalletHub cautioned against viewing the decline as evidence of a major shift in consumer borrowing behavior. Consumers typically reduce debt early in the year after holiday spending, then gradually rebuild balances throughout the year, according to the firm.
“A big reduction in credit card debt to start the year is way better than the alternative, of course, but it’s also the norm and not necessarily a sign of newfound consumer discipline,” said John Kiernan, editor at WalletHub.
The company projects credit card debt will ultimately increase by approximately $60 billion during 2026, suggesting household borrowing pressures remain far from resolved.
Originally reported by CU Today.