Credit Card Confidence Index: July 2023

How are Americans feeling about their ability to pay off their credit card bills?

That’s what we track every month with the LendingTree Credit Card Confidence Index — our exclusive monthly look at the mindset and payment habits of American credit cardholders.

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How the Credit Card Confidence Index works

Each month, we ask cardholders the following:

• On a scale of 1 (not at all confident) to 5 (very confident), how confident are you that you can pay the monthly statement balance on all your credit cards in full this month?
• How many times have you paid all your monthly statement balances in full in the past six months?
• How often do you expect to do it in the next six months?

On that first question, those who rate their confidence a 4 or 5 are deemed confident, while those who say 1 or 2 are deemed not confident. That’s how we get the short-term confidence percentage. (Example: If we say short-term confidence is at 63%, it means that 63% of cardholders surveyed rated their confidence as a 4 or 5 on that question.)

On the third question, we consider you confident if you say you expect to pay your monthly statement balances in full in at least five of the next six months. That’s how we get our long-term confidence percentage. (Example: If we say that long-term confidence is at 52%, it means that 52% of cardholders surveyed said they expect to pay their monthly statement in full either five or six times in the next six months.)

We also ask those who say they’re not confident in the long term why they feel that way. We present our findings, along with analysis on trends and how they fit in the general context of the economy as a whole, each month in this Credit Card Confidence Index.

The latest: Cardholder confidence rebounds, erases most of significant June decrease

Credit cardholder confidence bounced back in July, with short-term confidence seeing its biggest monthly increase of 2023 despite a growing gender gap.

Key findings

• Short-term confidence bounces back strong in July: 61% of cardholders say they’re confident they can pay their credit card’s monthly statement balance in full this month. That’s up 6 percentage points from last month, erasing almost all of June’s 7-percentage-point decline. It’s the biggest increase since a 10-percentage-point jump in December 2022.
• Confidence gap by gender highest in a year: 71% of men express confidence in being able to pay their credit card’s monthly statement balance in full this month, compared with 51% of women. That 20-point gap is the highest since the 24-point gap in July 2022 and has grown 7 points since May 2023.
• Long-term confidence rebounds, too: 45% of cardholders say they expect to pay their cards’ monthly statement balances in full in at least five of the next six months. As with short-term confidence, this number is up 6 points from last month, wiping out all but a point from a 7-point fall from June.

The bottom line: Expect a downward trend in coming months

In the Confidence Index’s nearly-five-year history, one of the few certainties is that big decreases in short-term confidence tend to be bumps in the road rather than the start of a major trend, and this month is further proof of that.

• June 2023, down 7 points; July 2023, up 6 points
• November 2022, down 9 points; December 2022, up 10 points
• June 2022, down 10 points; July 2022, up 6 points
• November 2021, down 9 points; December 2021, up 5 points
• November 2020, down 10 points; December 2020, up 5 points
• February 2019, down 9 points; March 2019, up 6 points

As you can tell, that’s been true before and during the coronavirus pandemic. It’s been true at different times of the year. It’s even been true in the face of tumultuous presidential elections and spikes in inflation. However, there could be a real test of that trend in the coming months.

A deeper look at the data shows that men have much further to fall than women. For example, men’s short-term confidence (71%) is at its highest level since December, while women’s (51%) is at its second-lowest level since November. (During that stretch, only last month — June 2023 — saw women at lower confidence levels.) That 20-point gap between the genders is the highest since July 2022.

So, what can you do if you’re facing restarted student loan payments and a tight budget? Start thinking about a plan. Revisit your budget to prioritize expenses and see if you can carve out some extra money to put toward knocking down your high-interest debt before those student loan payments resume. Zero-percent balance transfer credit cards, low-interest personal loans and high-yield savings accounts can help as well. You can also consider calling and asking your credit card issuer for a lower interest rate. That works more often than you might imagine.

What won’t work, however, is standing still and trying to wish the problem away. Start taking action now, even if it’s only something small. That’s because even small steps added up over time can make a difference.

Methodology

LendingTree commissioned QuestionPro to conduct an online survey of 1,460 U.S. credit cardholders ages 18 to 77 from July 7-12, 2023. 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.

Media inquiries about the Credit Card Confidence Index

Want to talk to Matt about the latest Confidence Index numbers? Email him at [email protected]. You can also reach out via Twitter at @matthewschulz or Instagram at @matt.schulz.