Household Debt Rising
$78 Billion Increase in Household Debt - WalletHub Report
Total household debt is high enough as it is, and it’s continuing to climb as the expensive holiday season approaches. The Federal Reserve Bank of New York released its latest data on household debt, and WalletHub’s inflation-adjusted analysis revealed that U.S. households increased their debt by roughly $78 billion during Q3 2023. WalletHub’s Household Debt Report adjusts data for inflation to accurately show how debt compares to historical levels.
Household debt is at a record high ($17.3 trillion), but when you adjust for inflation, the total is 7% below its peak from 2008 and WalletHub projected that U.S. households will end the year with $350+ billion more debt than they started with. In fact, according to WalletHub, the average household owed a total of $145,319 at the end of Q3 2023, only $13,631 below WalletHub’s projected breaking point for household finances.
U.S. consumers increased their total debt load by $78 billion during the third quarter, according to WalletHub’s analysis of newly released data from the Federal Reserve Bank of New York. The third-quarter increase brings total household debt to $17.3 trillion entering the expensive holiday season.
“Consumers typically rack up the most debt during the fourth quarter of the year as we spend excessively on holiday gifts and travel, so it’s not a good sign when we enter the final few months of the year with a lot of new debt,” said John Kiernan, WalletHub editor. “Given how Q3 played out, WalletHub is now projecting that U.S. households will end the year with $350+ billion more debt than they started with.”
The U.S. household debt situation certainly could be better, but when you compare current debt levels to the past and adjust for the unusually high inflation we’ve been experiencing, there’s reason for optimism. For example, WalletHub’s report found that the $78 billion in debt added during the third quarter was actually a 77% decline year over year.
To see WalletHub’s full report, visit https://wallethub.com/edu/d/household-debt-report/120725.
