U.S. credit card defaults rose to their highest level since the wake of the 2008 Great Recession, pointing to a deterioration in lower-income consumers’ financial health, the Financial Times reports.

Credit card lenders wrote off $46 billion in seriously delinquent credit card loan balances in the first nine months of 2024, a 50% increase from the same time period in 2023, according to BankRegData.

To put this in perspective, in all of 2023, banks and retailers wrote off nearly $60 billion in consumer credit card debt. Americans’ revolving credit topped $1 trillion for the first time in mid-2023—and consumers currently have $37 billion on their credit cards that is overdue one month or longer.

“High-income households are fine, but the bottom third of U.S. consumers are tapped out,” says Mark Zandi, head of Moody’s Analytics. “Their savings rate right now is zero.”

“Consumer spending power has been diminished,” concurs Odysseas Papadimitriou, WalletHub’s head of consumer credit research. “Delinquencies are pointing to more pain ahead.”

Data from CapitalOne, the third-largest credit card lender in the U.S., after JPMorgan Chase and Citigroup, showed its annualized cred card write-off rate at 6.1% in November, up from 5.2% a year ago.

Inflation is partly to blame for the $270 billion rise in credit card balances throughout 2022 and 2023. The Federal Reserve has also left borrowing costs at high levels, as inflation has proven sticky.

As consumers left the pandemic flush with unspent and relief cash, they readily found credit card lenders happy to sign them up for new cards.

Higher balances have resulted in Americans paying $170 billion in credit card interest in the past 12 months ending in September.

Last week, the Fed signaled it no longer foresaw cutting the Fed funds rate by one percentage point in 2025 but, rather, by 50 basis points, or half a percent.

Papadimitriou, like many economists, says President-elect Donald Trump’s tariff threat could increase both interest rates and inflation, which, he says, would be “two problematic things for the consumer in 2025.”