Chicago Booth Review Podcast Could using credit cards more save you money?
Jan 14, 2026
Abigail Sussman, a social psychologist at Chicago Booth, dives into her intriguing research on consumer financial behaviors, particularly co-holding savings and credit-card debt. She reveals that 20% of cardholders simultaneously carry debt while saving, a puzzling behavior that often reflects deliberate choices for financial security. The conversation explores mental accounting, where people separate payment methods, and highlights surprising preferences in spending. Sussman also discusses potential bank strategies to encourage smarter financial habits.
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What Co-holding Means
- Co-holding is when people keep liquid savings while carrying high-interest credit card debt at the same time.
- This means they effectively pay to borrow their own money instead of repaying debt with savings.
It's Deliberate, Not Just Forgetfulness
- Inattention doesn't explain co-holding; people often know they're doing it.
- Many maintain savings deliberately because it provides psychological value despite the cost.
Co-holding Is Common And Persistent
- About 20% of credit card holders in the Australian bank data were co-holding.
- The behavior is persistent: many co-holders do it in multiple years of the panel.