Consumers more confident about paying card bills in full
U.S. consumers will enter 2021 a little more confident than they were a month earlier in their ability to pay their credit card bills in full.
Nearly 70% of consumers surveyed said they were confident in their ability to pay their full monthly statement in December, up 5 percentage points from November, according to monthly data from the online lending marketplace LendingTree.
"The jump means consumer confidence ends 2020 on a high note," LendingTree stated about its survey of more than 700 cardholders. "That seems a fitting way to end a year in which consumers' faith in their ability to pay their monthly credit card statement balance in full rarely wavered, despite the economic wreckage caused by the COVID-19 crisis."
Just 18% of cardholders said they expect to pay their full credit card balance in one or fewer of the next six months, the second-lowest percentage since March 2019. Only 15% said they were not sure about being able to pay their bills in full in December.
In the wake of the November election, cardholders' confidence had dropped for just the second time in all of 2020. December's confidence rating was the third highest in the two-plus years in which LendingTree has compiled its monthly confidence rating.
Men were generally more optimistic than women about December's bills, but the number of men who say they are "very confident" at 47% fell for the third straight month. It marked the lowest percentage of very confident men since July and was about 17% lower than the record high in September.
Still, confidence overall was high, as 49% of cardholders say they expect to pay their monthly statements in full in at least five of the next six months, including 34% who expect to pay in full in all six months.
There were some lingering effects from the contentious 2020 election, as 66% of Republican cardholders said they were confident they could pay their bills in full in December. While a positive number, it did represent a drop from the 83% who said the same in October and 80% in September.
Though 49% of Republicans said they were "very confident," it was a 20-percentage-point drop from October for the highest confidence mark respondents could choose. In addition 14% said they were not at all confident — double the amount who made that claim in October.
Democrats, meanwhile, recorded a fourth straight month without a decrease in confidence. In a jump of 2 percentage points from November and 5 from August, 70% of Democrats said they were confident they could pay their bills in full in December.
"When the pandemic began, few would've expected cardholder confidence to remain as high as it has," the report stated. "Now that 2020 is nearly over, the election is behind us and coronavirus vaccines are beginning to be distributed, there's plenty of reason to believe that confidence will continue to grow."
LendingTree, which conducted the survey through Qualtrics in early December, noted that the start of 2021 would remain difficult for millions of American consumers because of high unemployment rates.