Credit card balances spiked in the third quarter to a record $1.08 trillion. Here’s how we got here.

Credit card balances spiked in the third quarter to a record $1.08 trillion. Here’s how we got here.

Credit card balances have been rising steadily over the last few years as more consumers have started using credit cards for everyday purchases and carrying higher amounts of debt. The rate of growth accelerated in the third quarter, pushed higher by increasing consumer spending on big-ticket items such as homes and cars.

At the same time, credit card issuers have been loosening their requirements and extending more credit to higher-risk customers. They’ve also been putting out more rewards programs and generous sign-up bonuses, which has further encouraged more borrowing. As a result, credit card debt is now at a record high.

Looking ahead, it’s likely that credit card balances will continue to rise as consumers take on more debt to finance their spending. However, if the economy slows down or an unexpected event occurs, credit card debt could begin to decline as individuals pull back on spending.