About one-quarter of Americans fall deeper into credit card debt every month, an alarming trend for an economy that’s depleted most of its excess savings since the pandemic.

According to a survey by Clever Real Estate, 23% of consumers acquire more credit card debt every month just to make ends meet. Alarmingly, 48% of credit card users rely on their cards to cover everyday living expenses such as food, rent, and utilities.

Overall, 61% of Americans are in credit card debt, with an average balance of just under $5,900.

The growing debt burden is making it harder for credit card users to stay on top of their payments, with 14% admitting they’ve missed a payment this year alone.

With average credit card interest rates approaching 23%—and as high as 29% for store credit cards—it’s not hard to see why.

The high stakes of missing payments

Americans in the Clever Real Estate survey blamed a combination of inflation and poor choices for their predicament. Still, a missed credit card payment could have serious consequences in the form of late fees, higher interest rates, and a poor credit rating.

Already, one-third of Americans fall into the “subprime borrower” category, meaning they’re considered a higher credit risk and pay higher interest rates and fees. According to CNBC, subprime borrowers are charged $1,599 more interest on the average credit card balance than borrowers with the highest credit ratings.

With credit card rates higher than they’ve ever been, the cost of missing a payment is getting more expensive. And yet, consumers face a double whammy from credit card companies that have managed to score billions of dollars in late fees despite regulatory scrutiny.

Regulators target 'junk fees'

Earlier this year, the Consumer Financial Protection Bureau (CFPB) announced plans to limit credit card late fees and prohibit lenders from charging excessive penalties. As it turns out, credit card issuers generated $12 billion in late fees in 2020, prompting regulators to look more closely into the matter.

"Over a decade ago, Congress banned excessive credit card late fees, but companies have exploited a regulatory loophole that has allowed them to escape scrutiny for charging an otherwise illegal junk fee,” said CFPB director Rohit Chopra.

The CFPB’s proposed rule “seeks to save families billions of dollars and ensure the credit card market is fair and competitive,” he said.

Reducing credit card fees would be a welcome reprieve for people struggling to pay their debts. However, even if all late fees were waived, credit card users would still be consumed with massive interest payments.

Credit card users paid $14.5 billion in late fees last year, whereas interest payments and other fees totaled $130 billion, according to new CFPB research.