Every year, Hillary Lanier puts her holiday shopping on credit, racking up debt that takes months to pay off. This season, the production planner said her total balance across four credit cards is in the five-figure range. “It’s definitely higher prices,” she said.
Lanier, who buys gifts for her parents, grandparents, siblings, friends and coworkers, said it could take her nine to 10 months to pay down the balance — just in time for next year’s holiday season. “I’ve tried to be conscientious and sticking to my budget, but it’s a very vicious cycle,” said the 32-year-old, who lives in Charlotte, North Carolina.
Hillary Lanier, 32, lives in Charlotte, North Carolina
Courtesy of Hillary Lanier
In fact, 37% of Americans racked up holiday debt this year, at an average of $1,223 — up from $1,181 last year, according to a new report by LendingTree. For parents, the tally was even higher, averaging $1,324. The site polled more than 2,000 U.S. adults earlier this month.
“Tariffs and high prices keep straining household budgets, and that strain becomes especially clear during the holidays,” Matt Schulz, LendingTree’s chief consumer finance analyst, said in a statement.
“Even sticking to the same shopping list as last year can cost more now,” he said. “People adjust where they can throughout the year, but many just can’t bring themselves to scale back holiday traditions, so it’s easy to see how those higher costs can translate into rising debt.”
Like Lanier, 63% of borrowers expect it’ll take three months or longer to pay it off, LendingTree found. Roughly 41% of those who took on debt this season are still paying off last year’s bills.
“Carrying a month or two of holiday debt is no big deal,” Schulz said. “Extend that out to six months to a year or longer and it becomes significant because of how high interest rates are on credit cards today.”
Credit card rates currently average more than 20%, according to Bankrate.
A consumer spending, confidence disconnect
Consumers, overall, are feeling more pessimistic about their financial standing, new data released Tuesday shows.
The Conference Board’s Consumer Confidence Index for December slumped to 89.1, a drop of 3.8 points from the prior month and its lowest reading since April, when Trump’s tariffs first went into effect. The measure for future expectations held steady at 70.7 — well below the 80 level considered a signal for a recession ahead.
Still, other data shows that shoppers continued to hit the stores in the last weeks of the year, pointing to a growing disconnect between consumer spending and consumer sentiment.
Consumer spending expanded by 3.5% in the third quarter after rising 2.5% in the second quarter, the Commerce Department said on Tuesday. The National Retail Federation forecast that holiday spending will surpass $1 trillion for the first time, increasing 3.7% to 4.2% over 2024.
Credit card balances top $6,500
Meanwhile, Americans’ credit card tab continues to creep higher. The average credit card balance per consumer now stands at $6,523, up 2.2% year over year, according to TransUnion’s latest credit industry insights report, from 2025′s third quarter.
Average credit balances also grew in November compared to the previous year, a separate report by VantageScore found.
That shows that more consumers are tapping additional liquidity than during last year’s holiday season, according to Susan Fahy, an executive vice president at the credit score developer.