Personal Finance

How Much Debt Does The Average American Have

By David Krug David Krug is the CEO & President of Bankovia. He's a lifelong expat who has lived in the Philippines, Mexico, Thailand, and Colombia. When he's not reading about cryptocurrencies, he's researching the latest personal finance software. 5 minute read

Debt is a major factor affecting the economic performance of the American public. Too much can lead to insolvency, while too little might make it difficult to secure financing for a house, car, or other large purchase. Finding the sweet spot between good and bad debt, while also taking into account your income and assets, is a talent that develops through time.

Decisions made by economists, investors, politicians, and business leaders throughout the world are heavily impacted by patterns in state and national debt, just as personal debt levels are. We’ve compiled some of the most important debt figures that everyone should be aware of.

Debt Statistics in a Nutshell

These data provide an aerial view of the national debt in the United States, illuminating the state of the nation’s fiscal health from a broader perspective.

  • In the second quarter of 2020, Americans owed a total of $14.27 trillion in consumer debt.
  • The total amount of consumer debt fell for the first time since 2014, from a record high of $14.3 trillion in Q1 to $14.27 trillion in Q2 of 2020.
  • Mortgage debt totals $9.78 trillion, or roughly 70% of total consumer debt in the United States. Student loans come in second at $1.54 trillion, followed by vehicle loans at $1.34 trillion.
  • Three point five percent of all consumer debt in the United States is now in an overdue position.
  • The average amount of debt for people aged 40–49 is $3.57 trillion, whereas the average amount of debt for those aged 18–29 is only $.94 trillion.
  • Nearly half (46%) of those polled in a Federal Reserve Survey in July 2020 said they could cover a $400 emergency need with cash on hand, while 38% said they could place the cost on a credit card and pay it off in full when they received their next statement.
  • In addition, 37% claimed to be “living comfortably,” 40% claimed to be “doing alright,” 17% claimed to be “just getting by,” and 6% claimed to be “finding it difficult to get by.”

Statistics on Credit Card Debt

In 2020, as a result of COVID-19’s effect on consumer spending, credit card debt decreased marginally.

  • In 2020, the typical credit card holder owed $1,624.60, while the typical family owed $6,124.
  • In 2020, Americans had accumulated $820 billion in credit card debt, which was $50 billion less than the previous year.
  • Credit card debt in the United States is $200 billion for people aged 50–59 and $50 billion for those aged 18–29.
  • In the US, the median FICO score is 703.
  • Six out of ten Americans have a credit score of 700 or above; 1.2% have a perfect score of 850.
  • The average credit score in Minnesota is the highest of any state, coming in at a whopping 733. With a median of only 667.4, Mississippi has the nation’s lowest average FICO score.

Statistics on Mortgage Debt

In 2020, like in previous years, mortgage debt will continue to represent the bulk of Americans’ total consumer debt.

  • In Q2 of 2020,1 the typical mortgage balance was $121,084.56.
  • Second quarter 2020 mortgage debt was $9.78 billion, a $370 billion increase over the previous quarter’s total.
  • Because of the CARES Act’s forbearance provisions, only roughly 24,000 mortgages went into foreclosure during the second quarter of 2020. Since the Federal Reserve started keeping track of this information in 2003, this is the lowest quarterly total by tens of thousands. As of the end of the third quarter of 2018, there have been 64,360 foreclosures,1 the lowest quarterly total before 2020.
  • In every age group except those between 18 and 29, when borrowers hold almost the same amount of mortgage and student loan debt (nearly $350 billion each), mortgages are by far the largest source of debt.
  • Mortgage debt is highest ($2.58 trillion) for borrowers aged 40–49 and lowest ($350 billion) for borrowers aged 18–29.
  • Mortgage-holding consumers, on average, have a FICO score of 747.

Statistics on Student Loan Debt

In the first quarter of 2020, the total federal student loan debt in the United States reached a new record high of $1.54 trillion, and it stayed at that level for the rest of the year.

  • In the second quarter of 2020, the total federal student loan debt was $1.54 trillion, which was flat from the first quarter but $20 billion more than the second quarter of 2019. 
  • The average value of student loans held by graduates of the Class of 2019 was $28,950. More than 62% of students graduating in 2019 had student loan debt.
  • With an average of $39,410 in debt for the Class of 2019, New Hampshire was the state with the highest average student loan debt. At about $17,935 per student, Utah had the nation’s lowest statewide average. 6

Statistics on Auto Loan Debt

The amount of money owed on vehicle loans in the United States has a lot to do with people’s general financial situations. There is a large spread in interest rates and financing terms for new and pre-owned vehicles, respectively.

  • In the second quarter of 2020, the median amount owed on a car loan was $11,679.60. In Q3 of 2019, the total amount of outstanding vehicle loan debt was $1.34 trillion, down by almost $10 billion from Q2 of 2019.
  • The average loan length for a new vehicle in Q2 of 2020 was 71.54 months, while the average loan term for a used vehicle was 65.3 months.
  • In Q2 of 2020, the average credit score for new car loans was 718 for new automobiles and 657 for used vehicles.
  • In the second quarter of 2020, the average monthly payment for a new vehicle was $568, while the average monthly payment for a used vehicle was $397.
  • During the second quarter of 2020, the average loan rate for a new vehicle was 5.15%, while the rate for a used vehicle was 9.69%.

Demographic Debt Statistics

The economic future of Americans varies greatly by demographic group. Debt levels vary by demographic characteristics such as race, family structure, and educational attainment, as shown by these data.

  • In 2019, white families had a median debt of $79,000, Hispanic families of $40,000., and black families of $27,500. African-American and Hispanic families had much higher levels of debt compared to their median levels of household assets. While median debt takes up just 26% of white families’ assets, it accounts for 53% of Black households’ assets and 56% of Hispanic households’.
  • Higher education borrowers averaged $217,530 in debt, while high school graduates averaged $94,300 in debt.
  • In 2019, white families had an average credit card balance of $6,940, Hispanic households carried an average balance of $5,510, and black households carried an average balance of $3,940.
  • In 2019, married couples with kids owning an average of $53,260 more than those without kids.
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