Household Debt Sees Slight Uptick

The Federal Reserve Bank of New York released new data on household debt, and WalletHub's inflation-adjusted analysis revealed that while U.S. households owe a record amount in absolute terms ($17.

80 trillion) as of Q2 2024, inflation-adjusted total debt barely changed during Q2, increasing by just 0.03% compared to the previous quarter. WalletHub's Household Debt Report adjusts data for inflation to provide an accurate comparison against historical levels.

You can find key highlights below: Q2 results. Total household debt increased by $5 billion during Q2 2024 in contrast to a decrease of $174 billion in Q2 2023. **Household average.

** The average household owed a total of $148,266 at the end of Q2 2024, which is $13,868 below the all-time high. Total debt-to-deposits ratio. Despite increasing recently, the ratio of total household debt to deposits indicates consumers are in good shape as it's still below pre-Covid levels and roughly 46% lower than its early 2000s peak.

Total debt-to-assets ratio. The ratio between total household debt and assets continues to be at a very healthy level of around 9.8%.

"U.S. households failed an important test during the second quarter of 2024, adding $5 billion in inflation-adjusted debt to break a streak of four consecutive years with declining household debt from Q1 to Q2," said John Kiernan, WalletHub editor.

"Increasing debt, stubborn inflation, and record high interest rates give consumers a lot of headwinds as we try to navigate the third and fourth quarters of the year when we traditionally rack up the most debt."