The record level of US household debt
US household debt hit a record $16.9 trillion in the last quarter of 2022 — around $128,824 per household, on average. This rise is due to several factors, many of which can combine and make it difficult for people to pay down loans. Here’s the data on US states with the highest household debt relative to income.
Total household debt increased by approximately $1.1 trillion (roughly 6.7%) throughout 2022. Inflation grew by 6.4% and kept consumer prices high. The increase in overall debt can be partially attributed to a 4% rise in interest rates by the Federal Reserve in 2022.
Despite the record-high household debt at the beginning of 2023, it was below the Q4 2008 peak of $17.4 trillion once adjusted for inflation.
Over 70% of current debt is from mortgages. At the end of 2022, it accounted for $11.73 trillion; student loan debt has risen over the past two decades to become the second-largest component of household debt. In Q4 2022, it reached $1.57 trillion.