Experian study: Average U.S. consumer debt and statistics

Although one might conclude that with both overall inflation and total consumer debt growth slowing, individual types of debt would exhibit a similar pattern. On the contrary, while some types of debt (including credit cards) are growing at close to double-digit rates, other types of debt (namely, student loans) are declining at a similar rate. And even the debt types that are growing at a rate closer to the overall average of 2.4% in 2024 have peculiar characteristics.

Generally, revolving types of debt (such as HELOCs and credit cards) grew well above the 2.4% average, while installment debts secured by assets (auto loans and mortgages, for instance) grew more moderately. Student loan balances declined markedly due to numerous federal student loan cancellations coming to fruition in 2024.

Experian addresses each type of debt in the following sections. Many of the increases or decreases in debt levels in 2024 are historically atypical, even compared with debt level changes during the already atypical pandemic years. And with a new administration in Washington this year, more changes that affect consumer debt levels, either directly or indirectly, are likely.

While the total consumer debt balance increased to $17.57 trillion in 2024, up 2.4% from 2023's $17.15 trillion, growth was slower than the 4.4% increase from 2022 to 2023.

In total dollar terms, most increases came in those types of debt backed by property, such as a home or vehicle. Credit card debt, most of which is not secured by an asset, also saw a sizable increase. Meanwhile, student loan borrowers owe less total debt than they did in 2023, thanks chiefly to student loan forgiveness becoming a reality for some borrowers.

Making predictions about the U.S. economy is a difficult task even in ordinary times, but it's a greater challenge with a new administration set to shift priorities in Washington in 2025. Consumer debt may be impacted either directly or indirectly by some of the new administration's proposals in 2025.

Even if more was known about various plans for tax cuts and levies, changes in regulation and changes in government spending, trying to guess their effect on consumer debt would be close to a fool's errand. Chances are, changes will occur in 2025—and it's still quite unclear what they'll be.

Curiously, interest rates, which are usually one of the more unpredictable variables in forecasts, could be a more reliable indicator of consumer debt growth in 2025. The key federal funds target rate began 2025 at 4.50%, a full percentage point lower than during much of last year.

Here's how those rate cuts, as well as other lending conditions, impacted various types of consumer debt in 2024—and how their impact may continue in 2025.

Generation X (you'll be reading a lot about them as the eldest of whom is preparing for retirement) still leads other generations in total debt despite being fewer in number than either millennials or baby boomers. Nonetheless, the cost of middle age keeps rising for the sandwich generation.

As usual, the total debt carried by generation tells us more about demographic changes than consumer spending. More of Generation Z are becoming of borrowing age than other generations, and overall credit use (as well as consumer spending) broadly declines with age.

Mortgage Debt Increases Modestly as Home Values Continue to Appreciate

Breaking down the components of these debts, about two-thirds of the total consumer debt is attributable to primary mortgage debt, as it's generally been since Experian began tracking this data in 2009.

However, mortgage debt is on firmer ground in 2024 than in 2009. Then, many homeowners found themselves owing more than their home was worth, as home prices collapsed across the nation.

Here's a look back at what the mortgage market conditions were like in 2009:

• As a procession of homeowners either walked away from their homes or had them foreclosed on, the average FICO® Score among homeowners 15 years ago dipped below 700. Today, the average FICO® Score for mortgage borrowers is above 750.
• Not only was home equity among newer homeowners virtually nonexistent, but more than a quarter of home loan borrowers were underwater on their mortgage. Contrast that to today, when homeowners have more equity than ever in their mortgaged property, and the percentage of homeowners considered underwater is slight.
• Lax underwriting requirements by lenders was one of the root causes of the housing crash and subsequent recession from 2007 to 2009. In 2024, rigorous underwriting ensures significantly lower mortgage delinquency.

Most observers would consider this two-thirds slice of consumer debt in 2024 as rock solid, while in 2009 mortgage debt was anything but.

Auto Loan Debt Moderates, but Sky-High Payments Remain

The total amount owed on auto loans increased by 1.5% to $1.54 trillion from Q3 2023 to Q3 2024. That's much less than in prior years, when both vehicle scarcity and higher borrowing rates pushed many drivers to their budgetary limits. Meanwhile, inventories on dealer lots are beginning to build up, and the electric car market is experiencing its own fluctuations.

Cars are still more costly to buy than they were three years ago, and insuring them is significantly more costly. While sticker prices remain high, they leveled off in 2023 as the automotive market mostly recovered from supply shortages that prevailed from 2020 through 2022, when buyers struggled to find a new or used car to purchase at any price.

Student Loan Debt Cancellations Result in 18% Decline

Student loan debt declined dramatically in 2024. Nearly 4 million borrowers collectively saw at least $140 billion in student loan debt canceled in 2024, according to Experian data that mirrors similar U.S. Department of Education data. That brought total federal student loan debt cancellation during the Biden administration to $180 billion.

In addition, some borrowers decided to repay their entire student loan balances before student loan payments resumed late in 2023, further accelerating the decline. As of Q3 2024, total student loan debts totaled $1.23 trillion, down from $1.47 trillion in Q3 2023.

Required student loan repayment returned in 2024, and student loan borrowers who did not resume their payments may now find that reflected in their credit reports. Meanwhile, newer graduates exiting their degree programs are adding their new student loan debt loads to those currently carried by more than 40 million Americans.

Credit Card Balance Revolvers Received Little Relief in 2024

Credit card borrowers continued to add purchases to their balances in 2024, growing total credit card debt an additional 8.6%, to $1.16 trillion as of Q3 2024. APRs, on average, are 4 percentage points higher than they were in 2022, which contributed to much of the additional increase.

As interest accrued at ever greater rates, consumers carrying balances saw an impact in their debt. Although Federal Reserve rate cuts began in 2024 after two painful years of rate hikes, average credit card APRs are still well above 22%, offering no relief to consumers who revolve balances from month to month. (For those with retail card debt, the APRs are even higher.)

And although credit card delinquencies are only increasing moderately, there are other signs that consumers may finally be maxed out on how much revolving credit card debt they can tolerate.

The total balance of personal loans, curiously, saw a decline of 3.2% in 2024, as a combination of tightening credit standards and alternative sources of refinancing household finances became relatively more attractive.

In 2024, American consumers owed slightly less on their personal loans than in 2023, despite higher credit card rates that usually serve as a catalyst for debt consolidation. Personal loans are often used as a lifeline by creditworthy borrowers with high credit card balances seeking rates more favorable than those offered by their credit cards.

The 3.2% decline in personal loan balances can't be definitely ascribed to one or two particular causes. However, jumps in other types of borrowing—including credit cards and HELOCs—suggest that at least some consumers have found similarly competitive offers from either 0% or low APR credit card balance transfer offers. In some cases, these borrowers may also have turned to home equity for funds.

Total HELOC Balances up 9.7%

Home equity lines of credit (HELOCs) may be part of the reason for the decline in personal loan debt. HELOC balances grew by 9.7% from 2023 to 2024, as home equity among homeowners, both with and without other debts or renovations to finance, finally began to tap some of the collective $30 trillion in real estate value they own.

Perhaps more relatable than collective debt in the millions and billions are the average balances for borrowers of the various types of debt, although even the averages aren't necessarily comfortable.

Most consumers, of course, don't carry each type of debt. It's quite likely that, for example, your own credit card balance is half the U.S. average, while your neighbor's is twice the average. Similar wide berths frame most other types of debt, depending on how long the borrower has been paying down the account in question and myriad other variables.

Generation X led all other generations in having the highest average auto loan, credit card and total non-mortgage balances. Each average balance eclipsed both older baby boomers and younger millennials by significant margins.

Only with mortgages is there another generation, millennials, that beats the Gen X average. That's in no small part due to sharply higher mortgage rates that were unfortunately timed to when most of these consumers were buying their first home. Those millennials who did ultimately find a home to purchase in 2024 paid a much higher mortgage rate—the average 30-year mortgage APR fluctuated between 6% and 7% for most of 2024—than those mortgage borrowers who preceded them.

In addition to carrying similarly outsized average levels of debt, both millennials and Generation X comprised the bulk of the American workforce in 2024. However, the ability of these generations to successfully manage and ultimately tame some of these more outsized balances will depend on making gains in income. In many cases, that will mean demanding more in wages as well as raises that keep up with their current debt loads.

Average total debt balances among U.S. consumers were largely unchanged in 2024, as consumers, on average, saw their average debt loads remain roughly the same as a year ago.

There were declines of 1% or more in some states, primarily in the Midwest, including Ohio and Michigan. In the few states where average consumer debt increased by more than 2% from 2023, such as California, Massachusetts and Utah, average mortgage balances in excess of $300,000 likely drove up averages more sharply. However, this is largely a year where average debt balances plateaued after several years of sharp increases among nearly every type of consumer debt.

When broken down by credit score ranges, only those with the best or the worst credit saw their debt load increase in 2024. Curiously enough, it could be that the same type of debt—auto loans—is at least partly informing these changes differently, depending on credit score. Here's how:

• Broadly speaking, those with the lowest credit scores often still need to finance a vehicle. Generally, those with lower scores are likely to receive more unfavorable rates on an auto loan, if they receive an offer at all.
• Meanwhile, those with fair, good, or very good credit scores may be forgoing an opportunity to finance a new vehicle at 2024 rates, hoping for either car prices, or at least car lending rates, to decline in the future. By postponing those purchases, total balances decline.
• Those with the highest credit scores may not need 0% financing to drive away with a new vehicle. These highly qualified buyers aren't as constrained by higher borrowing costs for new and used vehicles as those with less-than-pristine credit.

Although the above is a simplified explanation of what may be driving overall debt levels in 2025 and beyond, it illustrates how changes in the broader economy eventually find their way into the consumer credit economy with varying results for various cohorts. In the coming months, Experian will produce additional reports on each type of consumer debt listed above in greater detail.

So what do all these measures above say about how consumers are actually feeling about their finances? As seen over the past year, economic data and consumer sentiment can sometimes appear to conflict.

While the data reveals that credit scores largely plateaued in 2024, an Experian survey of 1,004 consumers found more reporting that their credit score had fallen than in 2023. Roughly 1 in 6 consumers said their credit score had fallen recently, versus 1 in 7 consumers reporting a lower score in 2023.

This result could simply reflect consumer perception. As debt levels rise and purse strings tighten, how a consumer feels about their own credit health can change even if their scores don't. This could also be reflective of an individual's ability to secure new debt even with unaltered scores.

And, in fact, delinquency rates did climb some in 2024. "Overall debt levels remain elevated and delinquency continues to rise, albeit at a slower pace. However, consumers seem to remain well-positioned," says Josee Farmer, economic analyst at Experian. In other words, those elevated levels and delinquency rates need to be put in a broader context.

"After accounting for strong personal incomes, debt loads are, in fact, historically low," Farmer says. "During the pandemic, we saw record-high wage growth across income groups, and it's the strength of personal income and rising net worth that have supported fervent spending behavior despite high inflation and the depletion of pandemic excess savings."

As for 2025, Farmer says lenders and borrowers both appear to be willing to lend and borrow, albeit constrained by interest rates: "Lending activity may start to pick up if the rate environment improves, although many lenders may proceed with caution, given greater uncertainty toward the outlook."

Methodology: The analysis results provided are based on an Experian-created statistically relevant aggregate sampling of its consumer credit database that may include use of the FICO® Score 8 version. Different sampling parameters may generate different findings compared with other similar analyses. Analyzed credit data did not contain personal identification information. Metro areas group counties and cities into specific geographic areas for population censuses and compilations of related statistical data.