Americans Are Drowning in Debt—Here's What the Numbers Really Say

The average American now carries $22,713 in personal debt (excluding mortgages), up from $21,800 just a year ago. While this might seem like a modest increase, the underlying story is far more troubling.

The Generational Divide

Debt isn’t distributed evenly. Gen X ($28,670) and millennials ($24,833) are carrying the heaviest load, while Gen Z ($16,478) and boomers ($18,272) have relatively lighter debt burdens. Yet here’s the kicker: over 60% of millennials and Gen X have zero concrete plan to pay it back. That’s not just concerning—it’s a red flag for financial instability.

Credit Cards Are the Real Culprit

Credit card debt accounts for 28% of personal debt (more than double any other source), with auto loans at 13% and education loans climbing to third place. The math is brutal: Americans are spending 29% of their monthly income just servicing debt.

The Federal Reserve’s latest data shows credit card balances hit a record $1.13 trillion—the highest in over a decade. Delinquencies and utilization rates are also maxing out.

The Perfect Storm: Inflation + High Interest Rates

This is where it gets real. Rising prices + higher borrowing costs = a financial squeeze most Americans aren’t equipped for. The evidence:

• Only 59% say they have a debt payoff strategy (down from 61% last year)
• 40% have zero emergency fund
• Among those with savings, only ~50% can cover 6+ months of expenses
• 34% are unsure what they can actually afford to spend vs. save (up from 26%)

The Bottom Line

Americans are making less progress on debt despite earning more in nominal terms. The purchasing power squeeze is real, and consumer financial health is deteriorating faster than the headlines suggest. The question isn’t whether debt is a problem—it’s whether we’re approaching a breaking point.