Americans’ collective credit card balance crossed the $1 trillion threshold for the first time in the second quarter last year. And the spending spree continued through the holiday season. Historically, credit card balances dip during the first quarter as people start paying off their seasonal spending. The New York Fed report captures consumer credit data as of Dec. 31, 2023.

Also keep in mind these are nominal figures that don’t consider inflation or higher consumer prices, New York Fed researchers pointed out in a media call following the release of the data.

And then there is this: Just over half — 51 percent — of cardholders typically pay their credit card bills in full, avoiding interest, according to a recent Bankrate credit card debt survey.

“Rising credit card balances reflect economic growth, population growth, and the fact that more people are using cards and fewer people are using cash,” said Ted Rossman, Bankrate’s senior industry analyst.

It’s a valid point that those who successfully navigate the credit card system aren’t in a debt dungeon.

Now, let’s look at the credit card data from the glass-half-empty side. I’m in this camp.

Bankrate found that 49 percent of consumers carry a balance month to month, up from 39 percent in 2021. And 58 percent of those with credit card debt have had it for at least a year, up from 50 percent in 2021.

Many consumers aren’t recklessly spending. They are resorting to credit to pay for unexpected emergencies, medical bills, car repairs or day-to-day expenses, such as groceries or day care, according to the Bankrate survey.

As the Federal Reserve fought rising inflation with rate hikes, the cost of credit card debt spiked. The average rate for accounts on which interest is assessed stood at 22.75 percent in November 2023. In 2019, pre-pandemic, the average rate was 16.98.

The New York Fed data also indicated that credit card delinquencies are worsening.

The amount considered seriously delinquent (90 days or more) increased to 6.36 percent for the fourth quarter, up from 4.01 in the same period a year earlier. That hike is disheartening.

“Even though the economy overall is still great, there are pockets out there where people are being overextended,” the New York Fed researchers said.

Inflation has fallen. Why are groceries still so expensive?

Serious credit card delinquencies increased across all age groups but notably among borrowers 18 to 39, according to the researchers.

It can be tough economically for young adults. It’s an expensive time in life, especially if you have student loan debt, said Matt Schulz, the chief credit analyst for LendingTree.

“You’re just starting to make a little money in your career,” he said. “You may have kids. You may be trying to buy a house. Your parents are getting older. You may have a car payment. There’s just a lot that’s going on.”

Here’s what I recommend if you’re carrying credit card debt.

Try the “debt dash” method. Let’s say you have five cards with balances ranging from $1,000 to $10,000. Organize your cards from the lowest to the highest balance. At the top of the list should be the card with the $1,000 balance. If you can, cut expenses — such as streaming services or coffee runs — to find extra money to start your debt dash on the first card. You will make the minimum payments on the other cards. Once you get rid of the $1,000, move to the next card on the list, adding the money from the first card payment to card No. 2.

‘Loud budgeting’ viral trend makes it chic to be cheap

In my experience when people can see quick progress, it gives them momentum. They then become more determined to get rid of the rest of their debt. Their aggressive payoff still avoids paying a lot of interest.

But if my plan doesn’t work for you, find one that does. You might want to tackle the card with the highest interest rate first.

“It really doesn’t matter what debt payoff method you use,” Schulz said. “Just find one that works and stick with it.”

Balance transfers: If your credit history is good, transfer your balances to a card with a zero percent promotion rate. I’m not a fan of using debt to pay debt, but for some, this can speed up a debt reduction.

Get credit counseling: If you’re having trouble managing your credit card debt, get help from a nonprofit credit counseling agency through the National Foundation for Credit Counseling (nfcc.org).

Raid your retirement account: Don’t tap your 401(k) or similar workplace retirement account to pay off the debt. Definitely don’t do it right now given the stock market’s climb. Let that money stay invested. Don’t compound one mistake (letting your credit card debt balloon for nonessential purchases) with another (robbing your retirement account).

If you want more personal finance advice that’s timeless, order your copy of Michelle Singletary’s Money Milestones.

Buy into easy money pitches: Beware of debt settlement companies promising a quick fix to your credit card debt misery. Debtors are a con artist’s dream. Borrowers are so desperate for debt relief that they believe scammers who promise the impossible — fast loan forgiveness. Don’t pay thousands of dollars to a debt settlement company when the money could have been better spent paying down your credit cards.

Don’t let the panic of being in debt open the door for unscrupulous companies to take advantage of your situation.