Young Americans Lead Credit Card Spending Surge As Cost Of Living Squeezes Paychecks

Gen Z and millennial customers recorded the fastest growth in credit card spending at Synchrony Financial during the third quarter, the company reported Tuesday, as rising living expenses and elevated borrowing costs strained household budgets.

The lender’s purchase volume climbed 8% to $49.7 billion, with younger consumers driving the strongest growth. The spending increase coincided with mounting affordability pressures, as Federal Reserve research found nearly half of Americans under 30 received financial assistance with expenses in 2025.

Synchrony CEO Brian Doubles said spending increased across generations and credit categories, with the fastest growth among younger customers. The company reported double-digit growth in spending outside its retail partners on both essential and discretionary purchases, including gas stations, electronics and discount stores.

Higher prices themselves contributed to the increase. Synchrony attributed part of its 9% purchase-volume growth in its Home & Auto division and 13% growth in its Diversified & Value division to rising gasoline prices, illustrating how consumers can spend more without necessarily purchasing more goods.

The financial pressures facing younger Americans extend beyond credit cards. A Federal Reserve survey released in May found 47% of adults ages 18 to 29 received help from someone outside their household to cover expenses in 2025, including housing, utilities, transportation and everyday purchases.

The same research found 49% of adults under 30 lived with a parent, up 12 percentage points from 2019. Nearly one-quarter of Americans ages 18 to 29 failed to pay all their bills in full during the month preceding the survey.

Housing affordability compounded the challenge. Home prices increased 54% nationally since 2020, according to Harvard University’s Joint Center for Housing Studies, while nearly half of renter households spent more than 30% of their income on housing at the latest count.

The pressure intensified in September as consumer prices rose 3.7% from a year earlier, while inflation-adjusted average hourly earnings fell 0.7%, according to the Bureau of Labor Statistics.

Federal Reserve data also revealed a widening divide between financially comfortable Americans and those struggling to make ends meet. Average credit card balances among respondents who reported difficulty getting by increased 37%, or $2,530, between 2023 and 2025. Balances among those living comfortably increased just 1%, or $59.

Carrying that debt remains expensive. The average interest rate on credit card accounts assessed interest reached 22.36% in August, according to Federal Reserve data. The Fed’s household survey found 46% of credit card holders ages 18 to 29 carried a balance at least once during 2025.

Synchrony’s outstanding loans increased 3% to $103.3 billion in the third quarter, although its delinquency figures offered a more encouraging picture. Loans at least 30 days past due declined to 4.34% from 4.39% a year earlier, while loans at least 90 days past due fell to 2.06% from 2.12%.

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