Susan Fahy, EVP and Chief Digital Officer at VantageScore, recently joined host Chuck Jaffe on the “Money Life” podcast to share VantageScore’s January 2025 CreditGauge™ and the current state of the U.S. consumer.

Susan noted a dichotomy between consumer sentiment and consumer spending, as revealed by the January CreditGauge™ insights.

As we closed out 2024, credit card balances did rise and consumers are spending. But, when you adjust that for inflation, it’s really flat compared to a year ago. The economic headwinds on higher interest rates and prices going up have contributed to consumers’ credit cards going up and balances rising. We are seeing consumers entering 2025 in a credit-cautious state.

Susan also commented on overall credit balances and how economic pressures are impacting high-earners—consumers making more than $150,000 per year.

“We see that consumers are using their credit card to make ends meet and spending less on discretionary items. As we came to the end of last year, the ‘high earners’ are falling more behind as their delinquencies rise at a faster rate than other income segments. Inflation continues to have an impact on all consumers.”

Link to podcast: https://moneylifeshow.libsyn.com/marketlifes-grimes-technicals-do-not-look-right-for-the-rally-to-roll-on