How Much Debt in America in Statistics and Demographics?

You might be curious to know information about how much debt the average American has. If you want to know that information, you can read the entire text below. Here, we will provide you with information on the average American debt and break it down by type of debt and age. We also want to share information related to economic change and debt in America in 2024, and the way you can do if you are in debt.

How Many Americans Are in Debt?

By the end of 2023, the net worth of American households increased to $156 trillion. However, the debt held by Americans is also increasing. According to research, Americans’ total personal debt reached an all-time high of $17.5 trillion. For your information, the average American adult has about $66,772 in debt. And, 77% of American households have some kind of debt. There are many types of debt in America, but some of the most common are mortgages, car loans, student loans, and credit cards. Almost all Americans have these loans, but some age groups have more debt than others. So, not only will we find out the total and average debt of Americans, but also the debt across different age groups. Speaking of debt, are you also one of those people who have debt? If you have debt, you must have signed your debt papers. And, you have agreed to make payments within a certain time for a set amount with interest. Make sure you pay your debts on time to avoid being fined.

Also Read: How to Make a Loan Agreement Between Friends

Average American Debt Per Household

Now let us find out the totals for American debt and average debt per household by five of debt types.

How Much Debt Does the Average American Owe?

We will inform you of the average American’s debt in the following types of debt.

• Mortgage Debt

Based on the table above, mortgage debt is the largest debt of Americans per household. Yes, it is indeed the largest type of monthly expense for most Americans. That means, Americans pay a larger percentage to pay mortgages than any other budget category. We found that Americans who have mortgages have an average monthly payment of $2,006.24. As mentioned in the table above, mortgage debt has the highest total compared to other types of debt, which is $12.25 trillion. In America, there are more than 84 million mortgages outstanding. And, the average balance for each mortgage is $145,833.26. By the way, do you also have mortgage debt? If yes, make sure you are not late in paying your mortgage debt installments.

• HELOC Debt

If you already own a home and need some money to fulfill your needs, you can apply for this type of loan. For your information, a Home Equity Line of Credit or HELOC is a type of loan that allows you to borrow a certain amount of cash. The loan amount you can take out is calculated based on the current value of your home. Based on research, in the United States, there are more than 13.1 million HELOCs, and the total debt across all of them is $360 billion. That means the average American has about $27,272 in HELOC debt. As it turns out, older Americans have the highest percentage of HELOC debt. Almost all Americans aged 18-29 have no HELOC debt. And, less than 1% of HELOC debt is held by Americans aged 30-39, but, when they are 70 and older, that percentage increases to almost 5%.

• Student Loan Debt

Currently, in America, student loan debt totals $1.6 trillion. The average student loan debt held by each borrower is about $38,290. Since the Great Recession, student loan debt has doubled, reaching 9% of the country’s total debt. This is the fastest growing debt in America. According to young American adults, the burden of student loan debt prevents them from making fundamental financial and life decisions. Because of student loan debt, 14% of Americans delay getting married, 33% of Americans delay buying a home, and 44% of Americans delay investing for retirement. For information, the student loan debt held by Americans aged 18-29 is $340 billion. And, the student loan debt owed by Americans aged 70+ is $30 billion.

Here is an overview of the federal student loan total debt by age:

• Auto Loan Debt

In the US, total auto loan debt is $1.6 trillion, the same as total student loan debt. About 35% percent of American households have auto loan debt. The average car loan debt owed by Americans is $36,357 per household. It does not need to be strange, because just like a house, a car is also a major necessity for most people. That is why many Americans take on this type of debt. For information, Americans with car loan debt have an average monthly car installment of around $738 for new vehicles and $532 for used vehicles.

Also Read: How Much is Repossession Fees for a Car?

• Credit Card Debt

We get information that eight out of 10 adults in America have credit card debt. According to research, there are more than 100 million Americans with credit card debt. As we mentioned in the table, the total credit card debt in America is $1.13 trillion. And, the average credit card debt per person is $6,501. Then, the average APR or interest rate on credit cards is 22.63%. If there are 100 million people with credit card debt in America, you can imagine how much profit credit card companies make from interest alone.

Here is an overview of the credit card total debt by age:

Average American Consumer Debt by Age

The following is the average and total consumer (or non-mortgage) debt of Americans by age. Notes: These averages include all American adults, both with and without debt.

Economic Change and Debt in America (2024)

As we know that the cost of living is getting more expensive. Since 2020, in the United States, the overall inflation rate is 19%. That means, compared to four years ago, the average price is 19% more expensive.

Here is a look at how much prices or costs increase in 2024:

• Home Costs

The average home cost in America in March 2024 was $429,950. This is a significant cost increase, reaching an increase of more than $130,000 since the beginning of 2020.

• Car Prices

Used car prices in America increased by 32%, starting from June 2020 to June 2023.

• Gas Prices

Compared to early 2020, in April 2024 a gallon of gas cost 29% more.

• Grocery prices

Over the past four years, grocery prices in America have increased by 25%.

• Credit Card Interest Rates

At the beginning of 2020, the average interest rate for credit cards was 16.61%. Then, at the beginning of 2024, the average interest rate for credit cards rose to 22.63%.

• Rising Insurance Premiums

In addition to the rising prices of houses, cars, gas, groceries and credit card interest rates, insurance premiums in almost every category also rose. The insurance with the highest rate of increase is car insurance. Since 2020, car insurances have increased by 36%.

As prices and costs continue to rise, Americans are taking on debt to make ends meet. This is certainly the case for citizens all over the country, not only Americans.

What to Do if You are in Debt?

If you are in debt, of course you will be stressed. You are not alone. There are many people going through the same thing as you. To calm your heart, we will provide information on what you should do when you are in debt.

1. Save an Initial Emergency Fund

Before you deal with your debt, you should have $1,000 or $2,000 saved up as an initial emergency fund. Why have an initial emergency fund? Because it will come in handy when you pay off your debts. After you pay off your debts, your life will definitely go on. You still have to survive and do your usual activities. If you pay off your debts without having an emergency fund, you will find it difficult to fulfill your needs, because your money has run out to pay off your debts. If that happens, you will most likely be tempted to use credit cards again and get into debt again.

2. Make a List of Debts from Smallest to Largest

Try writing down all the debts you have, from the smallest to the largest. This will help you evaluate which debts you should pay first. Some people who have debts prioritize the smallest debt first, and then pay the largest debt. However, there are also people who give the biggest debt first, then pay the smallest debt.

3. Pay Off Your Smallest Debt While Making Minimum Payments on Other Debts

According to research, paying the smallest debt first is better than pushing yourself to pay the biggest debt, but you cannot afford to do so. So, at this stage, you can use as much of your money as possible to pay off your smallest debt while continuing to make minimum payments on all your debts. Focusing and settling one debt at a time will help you settle your other debts.

4. Move On to The Next Debt

Once you have paid off your smallest debt, then you can use your money to pay your other debts. If you still have another small debt, then prioritize it. However, if there is no more small debt, then you can move to pay your large debts. For other large debts, please make minimum payments only.

5. Repeat the Cycle Until Your Debt is Paid Off

Continue this cycle or method until all your debts are completely paid off. You will feel relieved and satisfied every time you pay off one debt to another. Your achievement in paying off your smallest debt will encourage you to keep moving to pay off your other debts. That way, your larger debts will be paid off, and finally you will be free from debt.