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Americans 'Reluctant' to Spend Big, New Fed Report Reveals — Here's What It Means Still, the average U.S. household owes more than $17,000 in credit card debt, per NerdWallet.

By Amanda Breen

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Natnan Srisuwan | Getty Images

Many U.S. consumers have reeled in their purchases amid high inflation and recession fears.

Throughout 2022, consumer debt levels rose at record rates with people spending more freely post-pandemic peak, but as the year came to an end, the Federal Reserve hiked interest rates to curtail inflation — causing many Americans to close their wallets, per Federal Reserve data reported by CNN.

Related: I Went From Substantial Credit Card Debt to Millionaire Status. Here's How I Did It.

The average U.S. household owes $17,066 in credit card debt, and the average amount of credit card interest paid by households increased when the Fed raised interest rates, leaving U.S. households to pay an average of $1,380 in interest this year, assuming rates don't continue to rise, according to NerdWallet's annual study.

Now, Americans are more cautious about spending overall.

"Consumer spending certainly isn't falling off a cliff, but we are seeing ample evidence that Americans are becoming more reluctant to make certain purchases, especially larger expenses and acquiring physical goods," Ted Rossman, a senior industry analyst with Bankrate, told CNN. "Services spending has been more robust, perhaps still owing to pent-up demand that stacked up during the pandemic for things like traveling and dining out."

Related: How to Manage Personal Credit Card Debt as an Entrepreneur

Additionally, the Fed's report found that revolving credit balances (credit cards, for the most part), grew by 7.3% in December; that's the lowest increase month over month since the summer of 2021, per Rossman.

Growing balances in a month when spending dipped could indicate the impact of those higher interest rates, Rossman added.

Amanda Breen

Entrepreneur Staff

Senior Features Writer

Amanda Breen is a senior features writer at She is a graduate of Barnard College and received an MFA in writing at Columbia University, where she was a news fellow for the School of the Arts.

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