Credit Card Confidence Rebounds in June

Credit card confidence continued its 2024 roller-coaster ride in June, jumping four percentage points, according to the latest LendingTree Credit Card Confidence Index.

Every month since September 2018, LendingTree has asked a nationally representative sample of credit cardholders the following: “Think about all of your credit cards. On a scale of 1 to 5 (5 being very confident, 1 being not at all confident), how confident are you that you can pay the entire monthly statement balance on all of those cards in full this month?” Those who responded with 4s and 5s were called confident, while those who responded with 1s or 2s were deemed not confident.

June’s four-point increase continues an unusually volatile stretch for the index. In the past six months, we’ve seen drops of six and five points and jumps of four, seven, four and nine points.

Here’s what you need to know.

Key findings

• Credit card confidence jumps in June. 64% of cardholders say they’re confident in their ability to pay their credit cards’ monthly statement balances in full this month. That’s a four-point increase from last month and the fourth increase in the past six months. More than 1 in 5 cardholders (22%) say they aren’t confident.
• More than half of cardholding women today say they’re confident in paying their credit cards’ monthly statement balances in full this month. 57% of female cardholders express confidence, up five points from May. However, a significant gender gap remains, as 72% of male cardholders express confidence.
• Gen Z cardholders show the highest cardholder confidence, while Gen Xers still show the lowest. 71% of Gen Zers express confidence in being able to pay their credit cards’ monthly statement balances in full this month, compared with 68% of millennials, 64% of baby boomers and 57% of Gen Xers. Though still the lowest among the age groups, Xers’ confidence hit its highest level since December 2022.

Confidence rises as 2024 volatility continues

Cardholder confidence has, frankly, been all over the place the past six months:

• June 2024: Up four points
• May 2024: Down six points
• April 2024: Up seven points
• March 2024: Down five points
• February 2024: Up four points
• January 2024: Up nine points

None of those increases or decreases is an individual record. However, taken together (with December 2023), they represent the most volatile stretch since the index began in 2018. We had never seen four months in which every monthly movement was at least four points. Now we’ve seen seven straight, and it’s unclear when this volatility will end. (The closest we’d seen was the period from November 2018 to April 2019 in which every month saw jumps or dips of three points or more.)

While we’re in a period of great ups and downs, June’s increase could signal that this volatility is nearing an end. More than six in 10 cardholders (64%) say they’re confident in their ability to pay their credit cards’ monthly statement balances in full this month, while 22% say they aren’t confident and 14% say they’re neither. Yes, four points is a notable increase, but it comes on the heels of three months of bigger swings (down six in May, up seven in April and down five in March).

Looking just at 2024 numbers, the year has been more positive for cardholder confidence than the previous year, including June’s jump. That marks a major deviation from a trend that began after confidence peaked at 74% in October 2020. Consider the monthly averages for each of the past several years:

• 2020: 67% confident
• 2021: 66% confident
• 2022: 62% confident
• 2023: 59% confident

While those yearly average declines aren’t huge, their consistency is noteworthy. After all, multiple years of small decreases add to a larger one, and that’s what we saw through the end of 2023. However, there’s reason to believe those declines might be a thing of the past. Despite the volatility of the past several months, 2024’s monthly average is 62% confident, a significant jump from 2023 and equal to 2022.

Then, you have a significant number of cardholders who use their cards only sparingly, putting a few dollars a month on them. Those folks are probably pretty confident in paying off their statement balances, too.

If you removed the credit cardholders from those two scenarios — leaving only those who use credit cards more frequently — that confidence level would likely be well lower.

Massive gender gap remains

More than half of cardholding women (57%) express confidence, while 28% say they aren’t confident. That 57% is up five points from May.

More women have expressed confidence in 2024 than in 2023. So far in 2024, an average of 56% of women have said they were confident, versus just 52% in 2023. What hasn’t changed, however, is that there’s a massive gender gap. In the index’s five-plus-year history, there’s never been a month in which women have been more confident about their credit card bills than men. In fact, there have only been eight months in which the gender confidence gap fell to single digits, but none since July 2021. (The gap was seven points that month, equaling the record low set in April 2021.)

In June 2024, that gap is 15 points, unchanged from May and equaling the biggest since January 2024.

The average gap since the start of the index is 14 points.

Gen Z cardholders show the highest confidence, while Gen Xers show the lowest

The gap among age groups is generally less pronounced than the one between men and women. In June 2024, Gen Zers (ages 18 to 27) and millennials (ages 28 to 43) are the most confident in their ability to pay their monthly statement balances in full, at 71% and 68%, respectively. Baby boomers (ages 60 to 78) are close behind at 64%, while Gen Xers (ages 44 to 59) bring up the rear at 57%.

Though Gen X is still the least likely to express confidence, that 57% rate is their highest since December 2022, when confidence hit 59%. Even in that month, however, Gen Xers were the least confident. The last month in which they weren’t the least confident age group was August 2022. That month, 62% of Gen Xers expressed confidence, while just 60% of millennials did the same.

Recent volatility likely to die down soon, though maybe just briefly

At some point, the roller coaster of the past few months has to stop, and I think July might be the finish line. In the five-plus years of the index, noteworthy increases and decreases have typically been followed by a reversal of direction the following month. (Case in point: The ups and downs of the past few months. We also saw a seven-point drop in June 2023, followed by a six-point rise in July 2023.) Given that, I’d expect to see a decrease in July as Americans run up some credit card bills during their summer vacations. For the first time in months, however, I don’t expect a big movement.

One of the best things cardholders can do — whether they feel good about their finances or wobbly — is knock down their credit card debt. If you don’t, sky-high APRs mean it’ll only continue to grow.

The good news is you have options. A 0% balance transfer card might be your best weapon against high interest rates, though a personal loan can help, too.

And don’t forget that you might be able to lower your interest rate with a phone call. An April 2023 LendingTree survey found that 76% of cardholders who asked for a lower interest rate on their credit card in the past year got one, with an average rate reduction of six points. That can turn a 30% card into a 24% card or a 24% card into an 18% card. It’s absolutely worth the call.

Find your perfect card in 30 seconds. Check your approval odds so you can shop smarter.

Methodology

LendingTree commissioned QuestionPro to conduct an online survey of 2,000 U.S. credit cardholders ages 18 to 78 from June 4 to 6, 2024. The survey was administered using a nonprobability-based sample, and quotas were used to ensure the sample base represented the overall population. Researchers reviewed all responses for quality control.

We defined generations as the following ages in 2024:

• Generation Z: 18 to 27
• Millennial: 28 to 43
• Generation X: 44 to 59
• Baby boomer: 60 to 78

Media inquiries about the Credit Card Confidence Index

Want to talk to Matt — author of “Ask Questions, Save Money, Make More: How to Take Control of Your Financial Life” — about the latest Confidence Index numbers? Email him at [email protected]. You can also reach out via X at @bymattschulz or Instagram at @bymattschulz.