Credit Card Confessions: Inside America’s Spending Habits

The average American in 2025 has over $4,000 in credit card debt, but it’s not just from bills and groceries. Over half (53%) of consumers say they’ve gone into debt for small indulgences and experiences. To explore these spending habits and customer payment preferences, we surveyed more than 2,000 Americans across the U.S. Their responses reveal key insights for merchants, highlighting the categories where consumers are willing to spend, and the growing demand for frictionless payments solutions at the point of sale, such as tap to pay.

Across the country, credit cards are picking up the tab for more than just the basics. Nationwide, 53% of Americans have taken on credit card debt from purchasing luxury goods and experiences. In places like California, Illinois, and Maryland, dining out tops the list of luxuries people are willing to finance — a trend seen in 64% of states. Meanwhile, people in Idaho, Utah, and Rhode Island are more likely to go into debt for a vacation, while in Montana and Wyoming, buying holiday gifts is the top priority.

In terms of demographics, younger generations lead the way. Gen Z consumers are 24% more likely than older Americans to use their credit cards for dining at restaurants. In comparison, Millennials are more willing to use a credit card for bigger purchases, being 62% more likely than Gen Z to accumulate debt for vacations. Gen Zers are even willing to go into credit card debt for concert tickets, with one in eight having reported to have done so.

For business owners, particularly those in the dining and hospitality industries, this indicates a great deal about where customers are willing to spend their money and the necessity for effective merchant processing services. Americans continue to spend on experiences that they value and can easily access. For example, in states with the highest median income (MD, NJ, MA, CA and CT), spending on high-end dinners costing over $100 saw a notable 14% increase from 2024 to 2025, showcasing that even luxury dining experiences remain a priority. As Kurv CEO Afshin Yazdian put it,

People realized during COVID that experiences matter a little bit more than a watch or a purse… people are continuing to travel, eat out, and go to events and concerts. We’ve learned that those experiences really matter.

However, the rise of eating out is not always tied to luxury. Internal data shows a significant overall increase of 21% from 2024 to 2025 in spending on fast food across the U.S. This surge suggests that for many Americans, quick and affordable meals are becoming a practical alternative, with the cost of a fast food meal sometimes being cheaper than cooking a similar meal at home due to rising grocery costs across the country.

That’s where payment solutions come in, and Kurv, as a leading payment solutions provider, makes it easy for retailers to keep up with shifting habits, providing transparent, reliable, and flexible merchant services—the kind of support small businesses need today.

How Consumer Spending is Changing

To counteract credit card spending, Americans are employing various methods, such as taking on a side hustle or switching to more affordable brands, to alleviate the strain on their wallets. 

Although Americans use credit cards to treat themselves, nearly three in five have also taken on debt for everyday expenses. To combat this extra spending, consumers are finding ways to save money where they can. 60% of Americans have started cooking more meals at home, 50% have reduced their discretionary spending, and 49% have canceled subscriptions and memberships that weren’t essential. Gen Z has even gotten creative to reduce their debt, with one in four shopping for dupes — affordable alternatives to popular products.

Dupes aren’t the only way people are saving money. Over one in three Americans have started using AI to help them find deals. 62% of respondents utilize AI to compare prices across multiple retailers, and 43% employ AI tools to receive personalized recommendations. Yazdian spoke about the impact of AI in shopping and said,

If AI can get you exactly what you want and it’s already getting you the best price that’s out there…it saves a lot of people from doing the scrolling element of shopping. And so, I do think it will change behaviors. I think people will be a little bit more decisive.

As shoppers become more decisive, small businesses must make a good impression quickly. The companies that tend to stick in people’s minds? The ones that don’t overcomplicate things. The checkout process is smooth. The merchant services payment options make sense. And because it all feels easy, people come back without a second thought.

Customers’ Purchase Priorities

Even as Americans work to decrease their credit card debt, they’re still willing to open their wallets for the right purchases.

Just because shoppers are thinking more about their spending doesn’t mean they plan on slowing down. In the next six months, 45% of Americans’ discretionary spending is expected to stay the same, and 20% is set to increase. Americans expect to take on an average of $1,047 in credit card debt this holiday season, a decrease from the $1,817 over one in four Americans say they still owe from the 2024 season.

When deciding to spend, 50% of consumers cite convenience and speed of a transaction as a priority, followed by earning loyalty points/rewards (44%) and then the security of the payment method (43%). Improving the payment process is key to maintaining a business’s strength, and offering convenient and straightforward merchant processing services can ensure that customers continue to return. In fact, 17% of shoppers prioritize tap to pay options, and nearly one in four Americans avoid stores that don’t offer the convenient tap to pay functionality. With Kurv as your payment solutions provider, you can accept payments with modern, contactless options, enable security and functionality add-ons, and manage operations easily, allowing your customers to pay swiftly and exactly how they want.

1. Meet customers where they are: Consumers are still spending, and small businesses succeed when they act fast. Show up in the moment by promoting quickly and accepting payments wherever the customer is. Kurv helps businesses move quickly by letting them generate custom QR codes and send payment links by text or email in seconds. The Kurv Merchant Portal and app enable owners to take payments right away without friction.
2. Simplify the payment process: Too many steps or pop-ups can cause customers to abandon their checkout process mid-way. If you’re offering in-person services, Kurv’s new tap to pay on iPhone and Android enables quick and effortless payments, making checkout a more seamless experience.
3. Leverage AI personalization: As more shoppers utilize AI to find what they want, meet them halfway with tools that feel helpful, not pushy. Think less about intelligent search and more about intelligent security and efficiency. Kurv’s AI and machine learning features analyze transaction patterns to detect unusual activity in real time, automating risk checks while ensuring security and trust.
4. Demystify payments: Keep payments transparent and simple. Ensure customers can pay how they like, and always maintain a clear,  in-depth view of your own business finances. Kurv’s comprehensive suite of modern payment solutions includes fundamentals like credit card processing and essential risk management. 

Kurv, a leading merchant payments platform, offers flexible and secure payment solutions along with tools that make checkout a breeze. With Kurv, merchants can simplify their processing services, allowing customers to focus on what they love, not how they pay.