A new LendingTree survey of 2,000 US cardholders found that 58% of Gen Z cardholders typically pay only the minimum, 44% don’t know their interest rate, and 59% believe a credit myth that costs them money. For consumer lenders, these aren’t curiosities — they’re underwriting signals.
LendingTree surveyed 2,000 US cardholders in February 2026 about their credit card habits, misconceptions, and mistakes. The results, published in March, paint a detailed picture of how American consumers actually behave with revolving credit — as opposed to how they say they do or how underwriting models assume they do. For consumer lenders, several findings have direct portfolio implications.
The headline finding: 41% of all cardholders say they typically pay only the minimum required on at least one card per month. That number has a wide generational distribution that tells a more specific story. Among Gen Z cardholders (ages 18–29), the figure is 58%. Among millennials (ages 30–45), it is 55%. Among Gen X (ages 46–61), it drops to 37%. Among baby boomers (ages 62–80), it falls to 19%.
The income breakdown adds another layer. Cardholders earning less than $30,000 annually pay only the minimum at a rate of 46%. Those earning $30,000–$49,999: 47%. Those earning $50,000–$99,999: 37%. Notably, those earning $100,000 or more still pay only the minimum at a 40% rate — higher than the $50K–$99K cohort and not far below the lowest income bracket.
The parenting data is also significant: 56% of parents with young children typically pay only the minimum on at least one card. That is the second-highest segment after Gen Z, and it likely reflects the compounding financial pressure of childcare costs, housing, and energy expenses hitting simultaneously.
This is the finding with the most direct underwriting implication. More than four in ten cardholders do not know the APR on any of their credit cards — including 19% who carry a balance at least occasionally. An additional 24% know the rate on some but not all of their cards, meaning only 32% of cardholders have complete knowledge of all their cards’ interest rates.
The generational pattern here runs in the opposite direction from minimum payment behavior. Baby boomers are the most likely to not know their APR — 57% report no knowledge of any of their cards’ rates. Gen X: 49%. Millennials: 35%. Gen Z: 33%. Younger cardholders are more rate-aware, even as they are more likely to carry balances and pay minimums.
Women are far more likely than men to not know any of their cards’ rates — 51% versus 38%. And the lower the income, the less likely a cardholder is to know their APR. This creates a precise adverse selection problem: the borrowers least able to absorb high interest costs are the ones most likely to be unaware of what those costs are.
The most operationally significant misconception in the survey: nearly six in ten cardholders (59%) believe that carrying a small balance on their credit card will improve their credit score. It will not. Carrying a balance increases credit utilization, which typically harms scores rather than helping them. The only thing carrying a balance does reliably is generate interest revenue for the issuer.
The income gradient on this myth is the sharpest in the survey. Among cardholders earning less than $30,000 annually, 67% believe it. Among those earning $100,000 or more, 53% believe it. The myth is more prevalent among the borrowers least able to afford the carrying cost — and it is actively encouraging behavior that generates delinquency risk.
This matters because it is not a passive misconception. It is one that actively changes behavior. A cardholder who believes carrying a balance helps their score has a rationalized reason not to pay in full — and to keep a balance month after month. At 20%+ APR on a typical card, that misconception compounds quickly into material financial damage.
Nearly one in four cardholders agrees with the statement “I don’t need to build a big emergency fund because I can just use my credit cards in case of emergency.” Among Gen Z, that rises to 43%. Among parents of young children, 41%. Among millennials, 37%.
The behavioral consequence is already visible in the data: 72% of cardholders have used a credit card to cover an emergency expense. Among parents of young children, 81% have done so. This is not theoretical credit risk — it is the documented pattern of behavior for the majority of cardholders in the survey.
For consumer lenders, this finding reframes what a credit card balance often represents. A significant portion of revolving balances in the US are functioning as emergency fund substitutes — drawn down in response to an unexpected expense, carried at high interest because the cardholder has no savings cushion to pay them off. In a period of energy price shocks, rising food costs, and real wage compression, the frequency of those emergency draws is increasing. The $50–$150 per month in additional gasoline costs created by the Iran war energy shock has no savings buffer to absorb it for a large share of cardholders. It goes directly onto the card.
The LendingTree survey is consumer-facing research, but read as a portfolio stress-test input, it surfaces several specific risks.
Minimum payment behavior at this scale creates a debt trap dynamic. A 58% minimum-payment rate among Gen Z cardholders, combined with current APRs averaging above 20%, means a substantial portion of younger revolving balances are growing rather than shrinking each month. At a 20% APR, a cardholder paying only the minimum on a $3,000 balance will take more than a decade to pay it off and pay more in interest than the original principal. As real wages compress and energy costs rise, the probability that minimum-payment cardholders become delinquent cardholders increases substantially.
The credit myth is driving utilization higher. If 59% of cardholders believe carrying a balance improves their score, a meaningful share of that utilization is intentional rather than distress-driven. This makes utilization a noisier signal than it would otherwise be — some of the balance growth visible in credit bureau data reflects a rational (if misguided) strategy rather than financial stress. Separating intentional utilization from distress utilization requires behavioral data that credit bureau pulls don’t provide.
The emergency fund substitution effect is the most direct near-term risk. With 72% of cardholders having used credit cards for emergency expenses and 26% actively substituting cards for savings, the next wave of unexpected consumer expenses — medical, automotive, energy — will flow directly into revolving balances. That wave is already arriving. The March energy shock has added $100–$150 per month in fuel costs for average commuter households. That money is coming from somewhere. For households with no savings buffer — a majority of younger cardholders — it is coming from the credit card.
The LendingTree data was collected in February 2026, before the Iran war began. The behavioral patterns it documents are the baseline. The stress has since arrived.
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