Americans have more credit-card debt than ever, and millennials are really struggling to pay theirs off

• Credit-card debt in America has reached a record high of $930 billion, according to new Fed Reserve data first reported by the Wall Street Journal.
• Serious credit-card delinquency rates - payments made 90 days or more past due - have also increased, particularly among those ages 18 to 29.
• Millennials' difficulty in paying off their credit-card debt reflects their financial reality: an increasing cost of living that outpaces their income growth.
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Americans are running up their credit cards.

Credit-card debt reached an all-time high after balances increased by $46 billion from the third quarter of 2019 to $930 billion in the fourth quarter - surpassing its pre-recession peak, reported Yuka Hayashi for the Wall Street Journal, citing new Federal Reserve data.

The uptick is a double-edged sword, Hayashi wrote: increased spending signals a strong economy, but people are having trouble paying off their shopping habits.

Serious credit-card delinquency rates, defined as payments made at least 90 days past the due date, increased from 5.16% to 5.32% in the same time frame - the highest in nearly eight years, according to the Fed. Serious-delinquency rates are even higher for those ages 18 to 29, rising past the 2010 record high of 8.91% to 9.36%. A chart breaking down the Fed data shows that a greater percentage of the overall credit-card debt is held by people ages 50 and older.

That might explain why more than half (67%) of credit-card indebted millennials polled in a 2019 Insider and Morning Consult survey are experiencing some or a lot of stress about their credit-card debt.

Rising living costs are outpacing growth in millennial wages

The serious delinquency rates could be reflective of the financial realities millennials are facing, particularly that of an increasing cost of living that outpaces their income growth.

Multiple studies show that millennials have less purchasing power than previous generations did at the same age. A 2018 report from Student Loan Hero found that rent, home prices, and college tuition had all increased faster than incomes in the US. The latter is a particularly heavy weight - 62% of adults ages 18 to 29 with bachelor's degrees are dealing with student debt.

It doesn't help that those ages 25 to 34 on average have seen incomes increase by just $29 since 1974 when adjusted for inflation, according to a recent SuperMoney report that analyzed US Census Bureau data. That year, they were earning an average of $35,426, versus a mere $35,455 by 2017.

That's way less than the inflation-adjusted income growth for other age groups in the same time period - $2,900 for adults ages 35 to 44 and nearly $5,400 for those ages 45 to 54.

When most of a minimal income is put toward rising housing and education costs, it's easy to put daily living costs on a credit card and difficult to pay it off, ultimately spawning an endless cycle of credit-card debt.

However, Wilbert van der Klaauw, senior vice president at the New York Fed, said he's unsure whether the increase in credit-card delinquency rates is because certain cohorts of the population aren't faring well or because lending standards have become more relaxed, Hayashi reported. The Fed is "looking into" it, he said.