FinHealth Spend 2025: The Cost of Financial Services For American Households

In 2024, U.S. households spent an estimated $455 billion on financial services fees and interest, nearly $100 billion more than in 2022. Rising credit card balances and the return of student loan payments drove much of this increase, while overdraft fees ticked upward for the first time in years. 

Disparities in financial services fees and interest also continued in 2024, with vulnerable populations – including households who are not Financially Healthy, Black and Latine households, and households without prime credit scores – bearing the brunt of these burdens. At the same time, new data reveal shifts in bank account ownership and what it means to be “unbanked.” Together, these trends underscore how growing costs and persistent inequities continue to shape financial health across America.

Consumer spending on financial services fees and interest has jumped nearly $100 billion since 2022.
Total estimated spending on interest and fees, in billions, 2022-2024.

Financial Health and Racial Disparities in Fees and Interest 

• • For Financially Vulnerable households, spending on fees and interest alone made up 17% of their income, compared with just 1% among Financially Healthy households.
  • Black households spent twice as much of their income on financial services as white households (8% vs. 4%).
  • Households with subprime credit contributed 14% of household income toward fees and interest for financial services, compared with 2% among households with prime credit.

Key Findings on Financial Services Fees and Interest: 2024

• • Debt manageability is declining for some households. Only 57% of households carrying credit card debt month to month reported their debt is manageable in 2024, down from 67% in 2020.
  • Credit products continue to drive growth in estimated spending, led by credit card debt and student loans.
  • Estimated spending on fees and interest for federal student loans more than doubled year-over-year, rising to an estimated $31 billion in 2024. Almost one quarter of borrowers in active repayment reported struggling to make payments.
  • More than half of U.S. households hold multiple checking accounts, often across different institutions.

In 2024, Americans paid an estimated $165.1 billion in fees and interest on revolving general purpose credit card balances. Year-over-year growth in credit spending slowed as the growth in average credit card interest rate moderated, with interest and fees rising 10% in 2024 compared with 25% in 2023. Still, rising total outstanding balances and delinquencies indicate that credit card debt became harder to manage for many families, with vulnerable households significantly more likely to report incurring late fees. As balances have continued to grow over the past five years, households who carry credit card debt have reported less confidence in managing their overall household debt – underscoring growing strain among some borrowers.

Manageability of debt has declined among households with revolving credit card debt.
Total estimated spending on interest and fees, in billions, 2022-2024.

Notes: Bar chart (left axis) shows the percentage of cardholder households who reported they “have a manageable amount of debt” or “do not have any debt” over time. Households with revolving credit card debt are those who carried a balance for at least one month of the year on general purpose or private label credit cards (N = 1,673 in 2020, N = 2,024 in 2021, N = 2,006 in 2022, N = 2,150 in 2023, and N = 1,933 in 2024), and those without are households who did not carry a balance (N = 1,523 in 2020, N = 2,057 in 2021, N = 2,149 in 2022, N = 2,413 in 2023, and N = 2,308 in 2024). Line graph (right axis) represents total outstanding credit card debt: the sum of average annual balances for general purpose bank cards and private label cards. Balances are reported monthly in Equifax’s Monthly National Consumer Credit Reports and averaged across 12 months for each year. * Statistically significant relative to 2024 (p < 0.05).

Credit Card Debt Statistics for 2024 

• • Total fees and interest on general purpose card balances rose to an estimated $165.1 billion in 2024, up 10% from 2023. 
    • Meanwhile, estimated spending on fees and interest for private label cards held relatively steady at $15.4 billion, essentially unchanged from 2023. 
  • Overall, fees paid by households who carried a balance on general purpose cards were estimated at $25.8 billion, or 16% of fees and interest combined. 
    • Disparities were stark: 49% of Financially Vulnerable households paid a late fee, compared with 3% of Financially Healthy households. 
    • Black (20%) and Latine (16%) cardholders reported higher late fee incidence than white households (9%).
  • Only 57% of households with revolving credit card debt reported their debt was manageable in 2024, down from 67% in 2020.

While the overall share of households using buy now, pay later (BNPL) loans remained steady in 2024, households reported taking out more loans than in the past. Sixty percent of BNPL users reported taking out three or more loans in 2024, compared with 53% in 2023 and 51% in 2022. 

A persistent question about BNPL has been whether users are “stacking” multiple, concurrent loans from different institutions – a practice that may expose borrowers to unmanageable levels of debt and lenders to greater risk. One-third of BNPL users reported having taken loans multiple times in the past month, signaling overlapping payments. Among that group, 41% said their loans came from more than one provider.

The reported number of annual BNPL uses is growing.
Number of BNPL purchases in the last 12 months, among those with at least 1 BNPL purchase.

Notes: Among households with at least one BNPL purchase in the past year (N = 642 in 2022, N = 862 in 2023, and N = 724 in 2024). * Statistically significant relative to 2024 (p < 0.05).

Buy Now, Pay Later Trends for 2024

• • 16% of households reported using BNPL loans in 2024, essentially unchanged from the 17% of households who reported using this service in 2023. 
  • Among BNPL users, 60% reported taking out three or more loans – up from 53% in 2023. 
  • Of those with multiple loans in the past month, 41% borrowed from more than one provider – suggesting “stacking” is taking place. 
  • Reported spending challenges increased, with more BNPL users reporting difficulty affording payments.  
    • The share of users reporting no issues declined from 61% in 2023 to 55% in 2024, a significant decline.

For more than a decade, the FinHealth Spend Report has analyzed the cost of financial services for American households, particularly those struggling financially. In 2020, we debuted a new approach that blends extensive secondary research on financial products and trends with a nationally representative survey on financial service use. This report is the fifth annual publication under this revised methodology.

Our report leverages a unique multi-phase methodology that begins with in-depth secondary research and modeling to derive estimates of total spending on interest and fees by American households across dozens of financial products and services. This research is coupled with nationally representative survey data on household product use and outstanding debt over the previous 12 months. Pairing secondary analysis on spending with our survey data provides unique insight into how consumers navigate and utilize financial services. For more details on our methodology, please download the full report.

We are thankful for the sizable contributions and guidance of MK Falgout and Necati Celik, as well as ongoing support and collaboration from Lisa Berdie and Andrew Warren. We also appreciate the strategic guidance and leadership of David Silberman, Marisa Walster, and Taylor C. Nelms, and the valuable input of many of our other colleagues, including Sarah Gordon, Dan Miller, Cat New, Chris Vo, and Elvis Diaz.

This report benefits from insights and market intelligence from experts across the financial services industry, including Bankrate, New York State Department of Financial Services, The Pew Charitable Trusts, and Student Borrower Protection Center (SBPC).

This report is made possible through the financial support of Prudential Financial.