Average American Debt (2024)

  • The average American debt level has been rising for years.
  • Fewer than one quarter of American households live debt-free.
  • Learning ways to tackle debt can help you get a handle on your finances.

In 2021, Experian conducted a review of consumer debt and discovered the average American credit card balance was $5,221, car loans amounts were nearly $21,000 and personal loans owed amounted to slightly over $17,000. Meanwhile, the average American savings account had a balance of $4,500. The average debt of Americans is growing, diminishing net worth and financial security in the process.

Average debt in America

The Federal Reserve Bank of New York reported an increase in the total amount of debt in the American household, rising by $27 billion to $15.85 trillion, in the first quarter of 2022. Mortgage debt rose by $250 billion during this period, and car loan debt increased $11 billion. Put simply, the issue of debt in the typical American household is growing tremendously.

How much debt does the average American have?

The same 2021 study from Experian shows that the average American has a consumer debt balance of $96,371, up 3.9% from 2020. Mortgages, home equity lines of credit and student loan balances are the biggest contributors to American debt today.

How many Americans are in debt?

The percentage of Americans in debt depends on what type of debt is being reported. According to the Urban Institute, more than 64 million Americans carry credit card debt. The Experian study also found that 340 million Americans are currently carrying some form of debt.

What percentage of America is debt-free?

According to that same Experian study, less than 25% of American households are debt-free. This figure may be small for a variety of reasons, particularly because of the high number of home mortgages and auto loans many Americans have.

Average household debt by debt type

The average debt per American depends on a few factors, chiefly the type of debt in question. The 2021 Experian study details what kind of household debt Americans carry, gathered through calculating the average mortgage balance, average credit card balance, other loan balances and the use of consumer credit card accounts, among other factors.

Debt Type2021 Average Consumer Debt Balance
Mortgage debt$220,380
Home equity line of credit (HELOC)$39,556
Student loan debt$39,487
Auto loan debt and lease$20,987
Average credit card debt$5,221
Personal loans$17,064
Total average balance$96,371

Average debt by age

In the 2021 study Experian reviewed the relationship each generation has with debt. For example, millennials tend to carry less personal loan debt than Baby Boomers or Gen Xers.

Age Group2021 Total Average Debt
Generation Z$6,658
Millennials$13,418
Generation X$18,922
Baby Boomers$20,370
Silent Generation$17,334

Average debt by percentile of income

The Survey of Consumer Finances indicates that the amount of debt by net worth percentile grows as household income increases.

Percentile of Net Worth2019 Average Debt (Thousands)
Less than 25%$66.94
25% – 49.9%$89.07
50% – 74.9%$132.52
75% – 89.9%$186.02
90% – 100%$412.65

Average debt-to-income ratio in America

According to the Federal Reserve Bank of New York, the total amount of household debt in the United States reached a record-high $15.85 trillion by the spring of 2021. Some of this increase was spurred on by a loosejob market in 2020, when unemployment hit 14.8% in April 2020. The less income you bring in, the more likely you are to rely on credit, go into debt or have trouble paying off debts you may already have.

The debt-to-income ratio calculates how much debt a person has relative to their income. Expressed as a percentage, the average American debt-to-income ratio for 2021— comparing overall debt to annual income — was 145%, based on quarterly state-level data. The higher this ratio, the more debt a household has versus income.

Average debt by state

The average American family debt varies significantly by state.

States2021 Total Average Consumer Debt
Top 10
District of Columbia$159,957
Colorado$140,327
Hawaii$138,274
California$137,301
Washington$136,170
Maryland$126,687
Utah$122,474
Virginia$122,273
Massachusetts$120,370
Oregon$112,974
Bottom 10
Mississippi$60,615
West Virginia$60,907
Kentucky$68,685
Arkansas$69,010
Ohio$70,747
Alabama$72,138
Michigan$72,735
Indiana$73,995
Louisiana$75,373
Kansas$76,090

How much debt is normal?

There’s no general figure for how much debt is normal — your personal finance situation is unique and should be viewed as such when looking at your current debt levels. There’s also good debt versus bad debt: mortgages on a primary residence are often considered “good debt” since they’re repaid steadily over a period of time while you accumulate equity in your home. Bad debt, for example, can take the form of an unpaid credit card balances.

A few benchmarks can help you determine a normal amount of debt, however. You can gauge whether your debt is in line with what lenders want to see in an ideal candidate.

The Federal Housing Association (FHA) guidelines permit a total mortgage payment and any recurring monthly obligations ratio as high as 43% for borrowers. Your credit score provides an at-a-glance look at how debt affects your finances, and your credit report can help you determine whether your credit utilization is too high relative to income.

How to pay off your debt

Debt repayment can be approached several ways. Strategies typically include monthly payments and may employ debt consolidation or a loan refinance option (when feasible). Some may even include forbearance in lieu of delinquency, meaning a creditor may suspend repayment for a time to help you re-organize your finances.

Whether you consider the debt snowball or debt avalanche method to pay off debt, you’re taking action on the money you owe. Doing so can help you prepare for the next chapter in your life or an unforeseen emergency, all while doing what you can to meet or exceed the average American savings account total.

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Average American Debt (2024)

FAQs

What is the average debt for an American? ›

The average debt an American owes is $104,215 across mortgage loans, home equity lines of credit, auto loans, credit card debt, student loan debt, and other debts like personal loans. Data from Experian breaks down the average debt a consumer holds based on type, age, credit score, and state.

How many Americans are 100% debt free? ›

Around 23% of Americans are debt free, according to the most recent data available from the Federal Reserve. That figure factors in every type of debt, from credit card balances and student loans to mortgages, car loans and more. The exact definition of debt free can vary, though, depending on whom you ask.

What is the average debt of Dave Ramsey? ›

Key Takeaways

The average American debt (per U.S. adult) is $66,772. Each student loan borrower owes an average of $38,290. The typical household in the U.S. has nearly $36,357 in car debt.

How much debt is enough? ›

Ideally, financial experts like to see a DTI of no more than 15 to 20 percent of your net income. For example, a family with a $250 car payment and $100 of monthly credit card payments, and $2,500 net income per month would have a DTI of 14 percent ($350/$2,500 = 0.14 or 14%).

At what age are people debt-free? ›

A good goal is to be debt-free by retirement age, either 65 or earlier if you want. If you have other goals, such as taking a sabbatical or starting a business, you should make sure that your debt isn't going to hold you back.

Is $5000 in debt a lot? ›

$5,000 in credit card debt can be quite costly in the long run. That's especially the case if you only make minimum payments each month.

Which gender has more debt? ›

Women are stereotypically seen as irresponsible spenders, but the data doesn't back this up. According to a 2019 Experian study, men carry more debt than women across nearly all categories, including credit card debt — the study found that men have $125 more in credit card debt than women on average.

How many Americans are living paycheck to paycheck? ›

How Many Americans Are Living Paycheck to Paycheck? A 2023 survey conducted by Payroll.org highlighted that 78% of Americans live paycheck to paycheck, a 6% increase from the previous year.

Who owns over 70% of the US debt? ›

At the end of September 2023, domestic creditors held 77 percent of the outstanding debt held by the public. Foreign creditors held the remaining 23 percent. The Federal Reserve typically accounts for a significant proportion of debt held by the public owned by domestic investors.

How much credit card debt is normal? ›

How much credit card debt the average American has (and how to pay it off) The average American household now owes $7,951 in credit card debt, according to the most recent data available from the Federal Reserve Bank of New York and the U.S. Census Bureau. But that's just the average.

What is a good monthly debt? ›

Now that we've defined debt-to-income ratio, let's figure out what yours means. Generally speaking, a good debt-to-income ratio is anything less than or equal to 36%. Meanwhile, any ratio above 43% is considered too high. The biggest piece of your DTI ratio pie is bound to be your monthly mortgage payment.

What is a good debt worth? ›

Generally, a good debt ratio is around 1 to 1.5. However, the ideal debt ratio will vary depending on the industry, as some industries use more debt financing than others. Capital-intensive industries like the financial and manufacturing industries often have higher ratios that can be greater than 2.

Is the average person in debt? ›

The average American owed $103,358 in consumer debt in the second quarter of 2023, the latest data available, according to credit bureau Experian.

Is 20k in debt a lot? ›

$20,000 is a lot of credit card debt and it sounds like you're having trouble making progress,” says Rossman.

What is the 50 30 20 rule? ›

The 50-30-20 rule recommends putting 50% of your money toward needs, 30% toward wants, and 20% toward savings. The savings category also includes money you will need to realize your future goals.

What is the average credit score in the US? ›

What is the average credit score? The average FICO credit score in the US is 717, according to the latest FICO data. The average VantageScore is 701 as of January 2024. Credit scores, which are like a grade for your borrowing history, fall in the range of 300 to 850.

What is a good debt? ›

Good debt is generally considered any debt that may help you increase your net worth or generate future income.

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