A report by the Urban Institute, released in July 2026, highlights a concerning trend: one out of every three working-age adults in the United States has turned to credit cards to purchase groceries over the past year. This underscores the declining purchasing power affecting millions of American households.
The study, focusing on adults aged 18 to 64, reveals that 63.2% of this demographic used credit cards to pay for groceries in 2025, facing varying levels of financial stress.
Among them, 34.9% managed to pay off their balance in full each month, 19.6% only covered the minimum payment, leaving their debt unpaid, and 8.7% sometimes couldn't even make the minimum payment.
This last figure is particularly alarming: it was 7.1% in 2023, indicating a steady rise in the number of adults facing severe financial vulnerability over two years.
The report also points to the growth of a relatively new financing trend: nearly one in ten working-age adults used "buy now, pay later" services for groceries, with 34.8% of these users missing at least one payment.
Over half of the respondents—51.3%—reported that their food costs increased significantly in the past 12 months. Among them, 12.4% said they couldn't always cover even the minimum payment on their credit cards.
The economic backdrop sheds light on this mounting pressure: food prices have surged 33% since 2019, while wages have only risen by 29% in the same period, eroding the purchasing power of many Americans.
Annual food inflation reached 4.2% in May 2026, with fruits and vegetables seeing a 6.1% price hike compared to the previous year.
Staples like ground beef exemplify the tangible impact: a pound cost $6.82 in June 2026, marking a 79% increase from early 2019 prices.
Overall inflation in April 2026 was 3.8% year-over-year, the highest in three years, while grocery prices rose 3.6% compared to the same month the previous year.
The situation is exacerbated by additional factors: 48% of U.S. adults live paycheck to paycheck, and three million people lost access to food stamps in 2026, forcing low-income households to rely more heavily on credit to meet basic needs.
Total credit card debt in the United States surpassed $1.17 trillion in 2024, reflecting a structural trend where financing everyday consumption through debt has become a reality for tens of millions of families.
Understanding the Impact of Rising Food Costs in the U.S.
Why are more Americans using credit cards for groceries?
The increasing use of credit cards for groceries is driven by a decline in purchasing power caused by rising living costs and stagnant wage growth, forcing many to rely on credit to meet basic needs.
What is the "buy now, pay later" trend?
"Buy now, pay later" is a financing option that allows consumers to purchase items immediately and pay for them over time. It has become popular among those needing flexible payment options, especially for essentials like groceries.
How has food inflation affected U.S. households?
Food inflation has significantly increased the cost of essential items like fruits, vegetables, and meat, reducing the ability of many households to afford basic groceries without incurring debt.