For many Americans, using credit cards for everyday essentials has become a more common way to manage finances. As prices for groceries, gas, and utilities rise, more households are finding themselves in debt just to maintain basic living standards.
While paying for necessities with credit isn’t a new trend, the real issue arises when people can’t pay off their balances every month. According to a recent survey from Accredited Debt Relief, 66% of participants had used credit cards for grocery purchases in the past year, and 29% found themselves borrowing or using credit regularly to stay afloat.
When you start relying on credit for groceries and gas while only making the minimum payments, it’s pretty clear that your budget may be tight. As your debt principal increases, the interest owed can surpass what you actually spend on groceries.
When everyday expenses become long-term debt
Credit cards were intended to offer convenience and access to quick credit. For those who pay their balances in full each month, this can lead to rewards, purchase protections, and an interest-free grace period.
The trouble begins when credit cards transform into a substitute for actual income. For instance, if a household charges $800 for groceries monthly but only pays $600, that leftover $200 becomes a rolling debt, carrying into the next month. If this pattern continues, a household could end up with an extra $2,400 in debt after a year—before even considering interest.
This means that food and gas are consumed long before the debt is settled, creating a tricky situation. Unlike a mortgage or other loans that potentially have resale value, borrowing for groceries doesn’t leave anything tangible behind.
The Accredited Debt Relief survey points out that this problem affects more than just sporadic purchases. Only 28% of respondents felt comfortable covering their expenses while still managing to save money. A mere 14% believed they could be debt-free within a year at their current payment rate.
Credit card balances reach $1.26 trillion as borrowers fall behind
The mounting costs of using credit for daily expenses are being reflected in national debt figures. As the Federal Reserve Bank of New York reported, Americans collectively owed $1.26 trillion in credit card debt by the end of the second quarter of 2026, marking a $21 billion rise from the previous quarter and a $54 billion increase from the same time last year. The total household debt was about $18.8 trillion, encompassing mortgages, auto loans, and other obligations. While overall household debt slightly declined in that quarter, credit card balances surged.
During the same timeframe, 6.97% of credit card balances slipped into serious delinquency, meaning payments were 90 days overdue. This rate went from 7.6% in the third quarter of 2022 to 12.8% in early 2026, indicating that more people are falling behind on their payments.
These statistics support the growing concern that individuals are relying on borrowed money more than ever, especially as available incomes shrink. Over the last decade, various forms of debt have become more accessible, contributing to the increasingly precarious financial situation many find themselves in.
Buy now, pay later adds another layer of household debt
Buy now, pay later services allow consumers to break down their purchases into manageable installments rather than making a full payment right away. Typically, these arrangements involve four payments spread over six weeks, often without interest if paid on time.
This could be a helpful strategy for those with steady incomes and enough funds to meet each installment. Yet, it can become problematic when these services are used to buy essential items that aren’t affordable outright. If you spend $200 on groceries weekly but only pay $50 upfront, you might feel like you’re buying yourself time. But soon enough, you’ll find yourself needing to pay for groceries again on top of what you already owe.
The Consumer Financial Protection Bureau studied this dilemma and discovered that around 63% of BNPL borrowers had multiple loans at the same time during 2021 and 2022, with about 32% having loans from more than one provider. Young borrowers aged 18 to 24 were particularly impacted, as BNPL purchases made up 28% of their total unsecured debt during those months. Comparatively, the overall figure for all ages was 17%. Many in this group had subprime or deep-subprime credit scores.
Even though many BNPL plans don’t charge interest, missed payments can lead to fees and overdraft issues if there’s not enough money in the accounts when payments are due.
How to keep everyday borrowing from becoming a debt crisis
The first step for those relying on credit for daily expenses is to assess whether their debt is a temporary cash flow issue or a more pervasive problem in income versus expenses. This requires a detailed look at total monthly income, essential expenses, and outgoing payments for existing debts.
If you find that you can manage your living costs without accruing more debt, consider paying down more than just the minimum on your credit cards to save on interest and pay off your balances faster.
If it feels like your minimum payments are too much, consider taking more significant steps to address your debt before it worsens. There are options like nonprofit credit counseling and debt management plans that could consolidate payments and potentially reduce interest charges.
Debt consolidation might also help, but simply replacing multiple balances with one loan won’t address a continual budget deficiency. Negotiating with creditors for reduced principal can also be a viable option if your debts have outstripped your income.
The bottom line
The key difference between using credit for convenience and depending on it for survival is whether a household can repay borrowed amounts without accruing more debt.
Purchasing with a credit card or opting for an interest-free payment plan isn’t inherently problematic. But when your next paycheck is immediately designated for past groceries, borrowing shifts from a convenient financial tool to a significant issue.
