'The Ramsey Show' co-host George Kamel reacts to Guy Fieri's stance on leaving his fortune to his kids and how to avoid overspending and credit card debt.
American households racked up a record $17.29 trillion in debt last year, driven by mortgage, credit card and student loan balances, according to the latest numbers from the Federal Reserve Bank of New York. Now, fresh data indicates an alarmingly high percentage of consumers began falling behind on their payments at the same time.
A new study released by LendingTree found 29.6% of residents in the nation's 100 largest metros were behind on at least one debt payment during the third quarter of 2023, and 27.3% had serious delinquencies that were over 90 days past due or more. More than a quarter, 26.2%, had debt in collections.
Almost 30% of Americans were behind on at least one debt payment in the third quarter of 2023, nearly all of which were in serious delinquency, according to a new LendingTree analysis. (iStock / iStock)
"That’s a huge number of people behind on their debt payments," LendingTree chief credit analyst Matt Schulz said. "Late payments can damage your credit score, making things even tougher on you financially."
MORE AMERICANS ARE RACKING UP CREDIT CARD DEBT
More than a third of millennials (36.7%), ages 27 to 42, and Gen Zers (36.2%), ages 18 to 26, had at least one delinquent account last year. Millennials were found to have the highest default rates on credit card accounts (19.6%), auto payments (7.8%), personal loans (8.3%) and other debts (27.9%). However, Gen Xers, ages 43 to 58, were most likely to be behind on a mortgage payment, at 1.2%.
Gen Xers, ages 43 to 58, were the most likely to fall behind on a mortgage payment in the third quarter, LendingTree found. (David Paul Morris/Bloomberg via Getty Images / Getty Images)
"In the face of cooling, albeit still high inflation, and steep interest rates, a large number of Americans are struggling to keep up with their debt payments," Jacob Channel, LendingTree's senior economist, told FOX Business. "This is especially true for members of younger generations, who might not have the incomes or savings they need to really stay on top of what they owe."
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"While there's no sugar-coating how tough it can be on your credit score and broader finances when you fall behind on payments, the good news is that being delinquent on debt isn't necessarily the end of the world," Channel said.
U.S. consumers have increasingly used credit cards for everyday necessities as inflation remains elevated and continues to squeeze household budgets. (Robert Nickelsberg/Getty Images / Getty Images)
"Though it's no walk in the park, plenty of people who were once in serious debt have managed to climb out of the hole they found themselves in — especially if they were willing to carefully budget and rein their spending in."
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In the study, LendingTree analyzed anonymized credit reports of roughly 310,000 users on its platform from the largest 100 metros according to U.S. Census data.
FAQs
A new study released by LendingTree found 29.6% of residents in the nation's 100 largest metros were behind on at least one debt payment during the third quarter of 2023, and 27.3% had serious delinquencies that were over 90 days past due or more. More than a quarter, 26.2%, had debt in collections.
What is the largest source of debt for Americans? ›
Total balance (2023 Q4)
Mortgage debt is most Americans' largest debt, exceeding other types by a wide margin.
Do 80% of Americans have consumer debt? ›
According to financial experts, the percentage of Americans in debt is around 80%. 8 in 10 Americans have some form of consumer debt, and the average debt in America is $38,000 not including mortgage debt. Owing money just seems to be a way of life for Americans, as collectively we have $14 trillion in debt.
How many people have $50,000 in credit card debt? ›
Running up $50,000 in credit card debt is not impossible. About two million Americans do it every year. Paying off that bill?
What percentage of Americans have too much debt? ›
40% of Americans Have Been in Credit Card Debt for More Than 5 Years. The survey found that 47% of Americans have not been debt-free since 2018 to 2022, 14% have not been debt-free since 2013 to 2017, 11% have not been debt-free since 2008 to 2012 and 15% haven't been debt-free since before 2008.
Who does the United States owe the biggest share of the national debt to? ›
Japan owns the most at $1.1 trillion, followed by China, with $859 billion, and the United Kingdom at $668 billion. In isolation, this $7.4 trillion amount is a lot, said Scott Morris, a senior fellow at the Center for Global Development.
Who carries most of US debt? ›
All values are adjusted to 2023 dollars. As of January 2023, the five countries owning the most US debt are Japan ($1.1 trillion), China ($859 billion), the United Kingdom ($668 billion), Belgium ($331 billion), and Luxembourg ($318 billion).
Who owns over 70% of the US debt? ›
Of the $33T of debt, roughly 78% is owned by the public (70% US vs 30% International). The major US public owners include the FED ($6T, but they are no longer buyers), mutual funds, banks, states, pension funds and insurance companies.
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.
Which gender holds the most credit card 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.
According to survey data from the World Bank – which stems from 2021, due to a three-year survey released in the summer of 2022 – Canada, Israel, and Iceland were the only countries with credit card ownership higher than 74 percent.
How many Americans have over $10,000 in credit card debt? ›
Of those who had maxed out their credit cards, 85% said they were pushed to use their cards to the limit because of price increases from inflation. Approximately 22% of Americans said they now owe between $10,000 to $20,000 in credit card debt, and 5% have more than $30,000.
What is the most used credit card? ›
Most Common Types of Credit Cards
Of the four main types of credit cards—Visa, Mastercard, American Express and Discover—Visa is by far the most common, making up 58.3% of cards in circulation.
Will the US ever pay off its debt? ›
Eliminating the U.S. government's debt is a Herculean task that could take decades. In addition to obvious steps, such as hiking taxes and slashing spending, the government could take a number of other approaches, some of them unorthodox and even controversial.
How many credit cards does the average American have? ›
How many credit cards does the average person have? According to the latest figures from Experian, the average American has 3.84 credit cards with an average credit limit of $30,365.
What is the average net worth by age? ›
The average American net worth is $1,063,700, as of 2022. Net worth averages increase with age from $183,500 for those 35 and under to $1,794,600 for those 65 to 74. Net worth, however, tends to drop for those 75 and older.
What contributes the most to the US debt? ›
Tax cuts, stimulus programs, increased government spending, and decreased tax revenue caused by widespread unemployment generally account for sharp rises in the national debt. Visit the Historical Debt Outstanding dataset to explore and download this data.
What is the largest part of US debt? ›
That made Social Security, for a time, the federal government's single biggest creditor.) Today, the Federal Reserve System is the single largest holder of U.S. government debt.
What is the #1 debt for American households? ›
Average mortgage and HELOC debt in 2024
Data source: Experian (2024), Federal Reserve (2024), Freddie Mac (2024). Mortgages make up 70% of American consumer debt. That number has risen consistently since mid-2013 and has recently accelerated as home prices hit record levels.
What is the most common source of debt? ›
The most common sources of debt financing are commercial banks. Sources of debt financing include trade credit, accounts receivables, factoring, and finance companies.
