U.S. consumer debt levels have improved a bit from 2018, but the numbers remain deeply concerning, according to Northwestern Mutual.
U.S. adults 18 and older reported having an average of $29,800 in personal debt aside from mortgages, according to the latest findings from the firm’s 2019 Planning & Progress Study, based on an online survey conducted for it by Harris Feb. 20-March 5. The study also found that 15% of Americans believed they would be in debt until the day they died.
Although those numbers are “staggering,” they represent an improvement over 2018, when U.S. adults reported an average of $38,000 in personal debt.
That was “pretty significant improvement” from last year, Chantel Bonneau, a wealth management advisor at Northwestern Mutual, told ThinkAdvisor. Although the reasons for the improvement weren’t clear from the study, she guessed that a possible cause was the improved job market and positive, “full-employment economy.” After all, in prior studies like this, when respondents were asked what they would do with money from a “windfall” such as a bonus, many people said they would use it for savings or to pay off debt, she noted, adding: “I think they actually did that” now.
The U.S. debt problem, however, “continues to run deep with widespread implications,” Northwestern Mutual said, noting the 2019 study also found that 34% of Americans’ monthly incomes were being used to pay off their debt.
Additional findings of the new report included: Forty-five percent of Americans said debt made them feel anxiety on at least a monthly basis; 35% reported feeling guilt at least monthly due to their debt loads; 20% reported debt made them feel physically ill at least once each month and the same percentage weren’t even sure how much debt they had; and 34% were unsure how much of their monthly incomes were being used to pay off their debt.
Generation X respondents reported the highest levels of personal debt, with $36,000 on average, followed by baby boomers at $28,600, millennials at $27,900 and Gen Z at $14,700.