• 87% of millenials said they might not make minimum payments if they’re unable to work
  • Some 25% of credit card debtors have added on more credit card debt as a direct result of the pandemic
  • But most Americans have been spending less during the pandemic

A majority – 62% – of credit card debtors in the U.S. are worried that if the COVID-19 pandemic persists they might not be able to make minimum payments on their accounts over the next few months.

According to a survey by, citing data from Bankrate, 56% said they might miss making minimum payments if there is no more government stimulus money;  another 26% said they may skip payments when the $600 weekly supplemental unemployment benefits ended.

Among age groups, millennials are the most worried – some 87% said they might not make minimum payments if they’re unable to work; 79% if COVID-19 cases continue to surge.

“So far, I have been pleasantly surprised how few people have fallen behind on their payments during the pandemic,” stated industry analyst Ted Rossman.

But he warned that the situation may get bleaker when as the government stimulus expires.

Stimulus negotiations fell apart late last week. “It sounds like Republicans and Democrats could resume talks, or they may not,” Rossman told International Business Times. “The end result is leaving a lot of people hanging if they were counting on the expanded unemployment benefits, another round of stimulus checks or other relief. I think more stimulus is needed, and right now, we don’t know what if anything is coming down the pipeline.” also found that some 25% of credit card debtors have added on more credit card debt as a direct result of the pandemic – up from 23% in mid-April. Among millennials, 39% have increased their credit card debt, up from 34% in mid-April.

However, Rossman also said that most Americans have been spending less during the pandemic, and if possible, they’re making an effort to pay down that debt.

“While a lot of people are paying down credit card debt, others are in a tough spot if they don’t have enough money coming in and alternatives are dwindling,” he said. “It’s hard to get a new job right now, and the market for balance transfer cards has dried up.”

Rossman, commenting on the current COVID-19 crisis and the financial crisis from more than a decade ago, said that the conventional wisdom holds that the charge-off rate eventually matches the unemployment rate.

“During the financial crisis, the unemployment rate peaked at 10% in October 2009,” he said. “The charge-off rate peaked at 10.51% in the fourth quarter of 2009, according to the Federal Reserve.”

Rossman pointed out that the COVID-19 crisis came on much more quickly than the financial crisis.

“The fiscal and monetary policy responses were also swifter this time around, and consumers and businesses were generally in better shape prior to the COVID crisis,” he added. “We don’t yet know what path the virus will take or how long it will last. Initially, most thought it would be a deeper but shorter crisis. Unfortunately, it’s already showing signs of longevity.”

Indeed, Rossman indicated that the U.S. just witnessed its twentieth straight week with initial jobless claims over 1 million – during the financial crisis the peak for new jobless claims was 665,000 during a week in March 2009.

“Still, my gut feeling is that charge-offs will be lower this time around because of the quick actions by the federal government, the Federal Reserve, card issuers and consumers,” Rossman offered. “Delinquencies have not yet spiked, which is a good sign. In fact, outstanding revolving credit -- mostly credit card debt -- fell by 9.7% from February 2020 to June 2020 according to the Fed. That was a steeper drop than we saw during the financial crisis. Consumers are spending less and making debt payoff a priority.”

However, Rossman cautioned that this broader trend obscures some challenges at the household level.

“Sadly, many households are struggling with bills and unemployment and will eventually default,” he warned. “And the stimulus programs appear to be waning. Still, I’m optimistic charge-offs won’t be as widespread as they were in 2009. My instinct is that charge-offs will peak in the high single digits this time around. The figure stood at 3.76% in the first quarter of 2020, according to the Fed.”