NEW YORK—That having children is costly may not be surprising — but the extent to which parents with children depend on credit cards to cover those costs is, a new study shows.
Research prepared for the July New Reality Check: The Paycheck-to-Paycheck Report, a Pymnts.com collaboration with LendingClub, found people who live in households of three or more are more likely than average to have outstanding credit card balances.
“Surprisingly, consumers who live in households with three members are the most likely of any household size to say they carry credit card balances, but their balances are only about 7% larger than average,” Pymnts.com stated. “However, as household size can include members of any age, looking at household composition is important to understanding the extent to which parents are going into credit card debt.”
According to the analysis, the share of consumers with children living at home who carry credit card balances was higher than other consumer segments. Eighty-one percent of those living with children under the age of 18 reported outstanding credit card balances, with 79% of consumers living with children of any age saying the same. These shares are 8.5% and 6.4% higher than average, respectively, Pymnts.com stated.
Additional Findings
“While parents with children at home are only slightly more likely than the average consumer to carry credit card balances, these parents tend to carry significantly higher balances,” Pymnts.com said. “The average outstanding balances between these two consumer segments who live with their children are similar: Consumers with younger children at home have balances of $7,172, on average, and consumers with children of any age at home have balances of $7,062, on average. However, the credit card balances of consumers with children are as much as 26% higher than that carried by the average consumer.”
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