Despite $18.77T Debt Load, Consumers May Be In Better Shape Than It Appears
By CU Today Staff —
MIAMI--U.S. household debt remains near a record in raw dollars, but consumers may be in considerably better financial shape than the headline number suggests, according to a WalletHub analysis of new Federal Reserve Bank of New York data.
After adjusting for inflation, total household debt fell by $226 billion during the second quarter to $18.77 trillion, reversing a $29-billion increase during the same period a year earlier. The total remains roughly $1.4 trillion below the inflation-adjusted record, WalletHub reported.
The average household owed $155,274 at the end of the quarter, down from $157,285 in the first quarter and $17,066 below the all-time high. WalletHub's analysis also found household debt equal to 97% of deposits, below pre-pandemic levels and roughly 49% below its early-2000s peak.
Another measure of household financial health also improved. Total household debt represented 9.07% of assets at the end of the second quarter, down from 9.18% three months earlier and well below levels seen before and during the financial crisis.
“It seems like we’ve seen household debt hit record high after record high, with only adjustments for inflation saving us from setting an overall record. The second quarter of 2026 was a bit of an exception in that regard, with debt actually falling in absolute terms and consumers proving they are in better shape than most people think,” WalletHub Editor John Kiernan said. “For one thing, household debt is well below the record when you adjust for inflation. Plus, debt levels aren’t alarming when you compare them to deposits and assets. Those ratios are healthy compared to historical levels. The situation could be much better, of course, but many prognosticators have been expecting much worse.”
Originally reported by CU Today.