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Average U.S. Consumer Debt Reaches New Record in 2020

Just two months into 2020, the U.S. economy plunged into a recession, marking the start of what turned out to be one of the most economically tumultuous years in recent history. Overall, total outstanding consumer debt grew to just under $14.9 trillion. Several types of debt contributed to this growth, though it was notably counteracted by a decrease in credit card balances.

The public health and financial emergency brought on by the COVID-19 pandemic caused record unemployment and widespread economic anxiety. These impacts were apparent in consumer personal finances: Debt grew at unusual rates, consumer spending decreased and credit scores climbed—a sign that the pandemic caused many consumers to recalibrate their budgets.

As part of our ongoing review of consumer debt and credit in the U.S., Experian reviewed credit report data from the past decade to see how consumer debt has changed through the years. This analysis compares annually representative data for 2019 with data from the third quarter (Q3) of 2020. Read on for our insights and analysis.

Overall Consumer Debt Continues to Climb Amid Pandemic

Faced with severe economic uncertainty, U.S. consumers continued to borrow in 2020. The total outstanding U.S. consumer debt balance grew $800 billion to a record high of $14.88 trillion, according to Experian data, an increase of 6%—the highest annual growth recorded in over a decade.

Total Overall Debt Growth
2010201920202019-2020 Change
Total debt$11.32T$14.08T$14.88T+$800B (6%)

Source: Experian

Since 2010, consumer debt has increased a whopping 31%, or $3.56 trillion—inching up at an average of 2% annually. This average includes three years of declining debt—2010 through 2012—and the years since 2015 when debt grew 4% annually.
 

When taking a look at how specific types of debt have shifted since 2019, mortgage loans, auto loans, student loans and personal loans all reached new record highs. Student loan debt saw the largest growth (12%), followed by mortgage debt (7%) and personal loan debt (6%), according to Experian data from Q3 2020.

Conversely, overall credit card debt decreased for the first time in eight years, dropping by $73 billion (9%) and highlighting just how unusual debt changes have been in the past year. Home equity lines of credit (HELOCs) also continued their recent trend of declining balances, as did overall debt on retail credit cards.

Change in Total Balances by Debt Type
20192020Change
Mortgage$9.61T$10.31T+7.3%
Auto loan & lease$1.3T$1.35T+3.8%
Personal loan$305.26B$323.55B+6%
Student loan$1.41T$1.57T+11.3%
Credit card$829.15B$756.31B-8.8%
Retail credit card$89.97B$79.91B-11.2%
Home equity $124.32B$119.62B-3.8%
HELOC$420.11B$374.18B-10.9%

Source: Experian

Individual Debt Reaches Levels Last Attained in 2010

Though the average total debt balance among consumers saw virtually no growth from 2019 to 2020—just 0.3%—it has finally surpassed 2010 levels, when average debt peaked following the Great Recession.
 

While total debt balances increased over the past year, consumers didn't see growth across all categories of debt. Notably, average credit card debt declined by over 14%—a historic reduction that's likely helped consumers raise their credit scores. Consumer HELOC debt also fell, although this follows a multi-year trend of decline in this type of debt.

Student loans saw the largest growth in average balances over the past year at nearly 9%, followed by average auto loan debt and mortgage debt.

Change in Average Balance by Debt Type
20192020Change
Student loan$35,620$38,7928.90%
Auto loan$19,231$19,7032.50%
Mortgage $203,296$208,1852.40%
Personal loan$16,259$16,4581.20%
HELOC$45,191$41,954-7.20%
Credit card$6,194$5,315-14.20%
Total avg. balance$92,479$92,7270.30%

Source: Experian

Economic Conditions Explain Some Changes in Consumer Borrowing

While debt has grown, and consumers appear to have maintained a healthy relationship with credit during the pandemic, it's important to highlight the larger economic backdrop that has enabled—and in other cases, necessitated—much of this growth.

First, the pandemic caused record unemployment and launched the economy into an abrupt downturn. The civilian unemployment rate was as low as 3.5% in the months leading up to the onset of the pandemic, before shooting up to a peak of 14.8% in April 2020—the highest level since 1948. As of February 2021, the unemployment rate stood at 6.2%.

With so many Americans out of work, Congress passed the Coronavirus Aid, Relief and Economic Security (CARES) Act which, among other things, gave one-time payments of $1,200 to many adults; expanded unemployment payments and eligibility and suspended student loan repayment for federally held student debt. Second and third relief packages, rolled out in December 2020 and in March 2021, also provided additional direct cash payments and extended initial assistance programs.

Since widespread stay-at-home orders effectively shut down—or severely restricted—activities like shopping, travel and in-restaurant dining for a period of time, consumers also found themselves spending differently than before. An Experian survey from November 2020 showed that 66% of consumers were spending the same or less during the pandemic than they had in the year prior. In addition, nearly one-third of those surveyed said they put more in savings in 2020 than they did in the last year. The U.S. Bureau of Economic Analysis reported that the Personal Saving Rate reached record highs in April 2020, hovering now at the highest level it's been since 1975.

While some consumers may have been able to save more, Experian's survey also showed that 59% of consumers lost their job or had wages reduced due to the pandemic—factors that almost certainly hampered their ability to save extra.

The pandemic has clearly had disproportionate impacts on consumer finances—those able to work from home may be in a good financial position, while many who lost their income may be suffering. A Pew Research Center Study found that many Americans have faced financial woes due to the pandemic, with financial hardships more common among lower-income workers and those without a college degree.

In both life scenarios, however, taking on new debt can make sense or may even be necessary. For those who've lost income, new debt can be a vital lifeline to pay for everyday expenses. On the other hand, someone whose income hasn't been negatively affected may be taking on debt to buy a new car or house or make another major purchase.

While it's unclear which of those factors could be driving the increase in debt, this report explores how debt has grown and highlights factors that may explain who is taking on new debt.

Most States See Increase in Average Consumer Debt

Nationally, the average debt per consumer didn't drastically change in 2020. In individual states, though, the story varied. Debt fell in some places, but the majority of states saw debt increase—by as much as 5.9%. Of the 50 states and Washington, D.C., 36 saw balances increase while 14 (plus D.C.) saw average totals go down.

Of the areas that saw an increase, only two states saw growth that was in line with the national average (0.3%). The rest (34 states) saw growth of at least 0.6%, with many seeing growth above 1%.

On the other end of the spectrum, consumers in 15 states and Washington, D.C., saw their average debt totals go down. The majority of states where balances shrank saw a decrease of 1% or more.

Consumer Total Average Debt by State
StateAverage FICO® Score 20192020Change
Alabama686$68,263$69,628+2%
Alaska714$110,386$108,208-2%
Arizona706$97,718$98,346+0.6%
Arkansas690$65,725$67,045+2%
California716$132,861$130,793-1.6%
Colorado725$129,770$131,995+1.7%
Connecticut723$108,388$105,109-3%
Delaware710$98,087$98,759+0.7%
District of Columbia713$149,205$148,041-0.8%
Florida701$79,341$81,504+2.7%
Georgia689$83,478$84,349+1%
Hawaii727$137,969$133,903-2.9%
Idaho720$93,044$97,803+5.1%
Illinois716$85,155$83,968-1.4%
Indiana707$70,063$71,801+2.5%
Iowa726$73,056$73,979+1.3%
Kansas717$72,468$73,123+0.9%
Kentucky698$64,711$67,029+3.6%
Louisiana684$72,609$73,225+0.8%
Maine721$75,268$77,537+3%
Maryland712$125,892$123,320-2%
Massachusetts729$116,703$115,671-0.9%
Michigan714$69,719$70,313+0.9%
Minnesota739$96,111$96,832+0.8%
Mississippi675$57,518$58,204+1.2%
Missouri707$74,139$75,292+1.6%
Montana726$86,495$89,282+3.2%
Nebraska728$75,327$76,652+1.8%
Nevada695$97,915$101,727+3.9%
New Hampshire729$95,709$95,504-0.2%
New Jersey721$104,398$102,096-2.2%
New Mexico694$77,344$76,379-1.2%
New York718$86,396$84,281-2.4%
North Carolina703$79,636$84,343+5.9%
North Dakota730$81,777$82,269+0.6%
Ohio711$68,547$68,754+0.3%
Oklahoma690$65,930$68,278+3.6%
Oregon727$104,875$107,440+2.4%
Pennsylvania720$78,263$77,477-1%
Rhode Island719$91,874$91,788-0.1%
South Carolina689$78,634$81,215+3.3%
South Dakota731$79,821$82,118+2.9%
Tennessee697$77,466$79,903+3.1%
Texas688$79,788$81,360+2%
Utah723$111,487$114,293+2.5%
Vermont731$83,011$83,335+0.4%
Virginia717$120,419$118,776-1.4%
Washington730$124,076$127,333+2.6%
West Virginia695$58,226$59,113+1.5%
Wisconsin732$76,846$78,272+1.9%
Wyoming719$96,416$97,189+0.8%

Source: Experian

Notably, the states with the fastest-growing debt had lower average balances in 2019. In the 10 states with the largest consumer debt increases in 2020, the average total balance across those areas was approximately $88,000 in 2019. In the 10 states with the biggest decreases in consumer debt in 2020, their balances in 2019 averaged around $103,000—$15,000 more than the states that experienced debt growth.

Younger Generations Drove Debt Growth During Pandemic

One of the most salient trends in the past year has been the growth of debt among younger generations. Not only did millennials and members of Generation Z see the greatest overall debt growth, but Gen Z notably saw the highest growth across mortgage and personal loan debt in 2020.

Overall, the increase in average total balances seemed to track with age—the greatest growth occurred among the youngest consumer group, with the oldest group recording a decrease.

Change in Total Average Debt by Generation
20192020Change
Generation Z (18-23)$9,593$16,043+67.2%
Millennials (24-39)$78,396$87,448+11.5%
Generation X (40-55)$135,841$140,643+3.5%
Baby boomers (56-74)$96,984$97,290+0.3%
Silent generation (75+)$43,255$41,281-4.6%

Source: Experian; Ages as of 2020

Consumers With the Lowest Credit Scores Saw Greatest Decrease in Debt

Across the different FICO® Score ranges, the amount of debt consumers are carrying shifted in varying ways over the past year. The group of consumers with the lowest credit scores on average—from 300 to 579—reduced their total average debt the most in 2020. Their total balance fell by around 6%, nearly tripling the reduction seen by consumers with the highest credit scores.

Consumers with FICO® Scores from 580 to 669—considered "fair"—were the only group to see their total average debt increase in 2020.

Credit scores are a reflection of a consumer's past experience with debt. That means that someone could have a high income and high net worth, while still having a low credit score based on how they've managed their debt.

That said, the reduction in debt among those in the lowest score tier could be explained by this group aggressively paying down their balances during the pandemic. It could also be a product of them being issued less new debt—a result of a more restrictive lending environment.

Change in Total Average Debt by FICO® Score Range
20192020Change
300-579

Very poor

$38,324$36,185-5.6%
580-669

Fair

$63,060$63,364+0.5%
670-739

Good

$91,186$89,585-1.8%
740-799

Very good

$100,263$99,471-0.8%
800-850

Exceptional

$136,801$133,446-2.5%

Source: Experian

Severe Delinquency Rates See Greatest Improvement

One of the positive—and likely intended—impacts of the federal government's efforts to insulate consumer finances from the pandemic has been the significant improvement in delinquency rates over the past year.

The CARES Act, as well as other legislation and executive action, did things such as increase unemployment benefits, suspend federal student loan repayment and make mortgage forbearance available to those in need. It also required that creditors report any account that was subject to a payment accommodation as current to the credit bureaus—as long as the account was current when the accommodation was made.

With student loan repayment suspended for so many borrowers—72% of student loan accounts were in forbearance or deferral in 2020 as of Q3 2020—it became impossible for some consumers to fall behind on debt payments for the time being. As a result, delinquency rates—the percentage of accounts 30, 60 or 90 or more days past due (DPD)—have dropped across all delinquency periods. Credit scores have also increased at a rapid rate, with the average FICO® Score rising seven points to an average of 710 in 2020, according to Experian data.

And while these data points look positive as of now, they are only a snapshot of consumer behavior. It's important to remember that as pandemic relief efforts expire, consumers unable to regain their income or those who experienced severe financial strain may find themselves behind on their debt payments—which ultimately may reverse some of the financial improvements made during 2020.

Overall Delinquency Rates
Delinquency Period20192020Percent Change
% of accounts 30-59 DPD0.86%0.58%-32.6%
% of accounts 60-89 DPD0.44%0.30%-31.8%
% of accounts 90-180 DPD1.25%0.60%-52.0%

Source: Experian

A Look at Consumer Balances by Debt Type

To better understand how individual debt categories affect overall debt totals, we looked at the numbers by type of credit product.

Credit Card Debt

Overall, consumers in the U.S. had a total of $756 billion in credit card debt in 2020. That figure was down 9%, or $73 billion, from 2019, and this reduction in balances has likely helped consumers reduce their credit utilization and improve their credit scores.

  • The average FICO® Score for someone with a credit card balance in 2020 was 735.
  • Alaska was the state with the highest average credit card balance in 2020 at $6,647.
  • Washington, D.C., saw the greatest decrease in average credit card debt in 2020 at 20%.

This year's reduction in debt stood out, as it marks the first time in eight years credit card debt did not increase. Consumers have been steadily adding to overall credit card debt since 2012, and this year's shift appears to be a reaction to pandemic forces.

Credit Card Delinquency Rates
Delinquency Period20192020Percent Change
% of accounts 30-59 DPD0.69%0.47%-31.9%
% of accounts 60-89 DPD0.41%0.28%-31.7%
% of accounts 90-180 DPD0.91%0.69%-24.2%

Source: Experian

Delinquencies were down for credit cards in 2020, with all degrees of delinquency experiencing improvements. Members of Generation X held the most credit card debt in 2020, followed by baby boomers and millennials.

Credit Card Debt by Generation
GenerationBalance
Generation Z$1,963
Millennials$4,322
Generation X$7,155
Baby boomers$6,043
Silent generation$3,177

Source: Experian

Read more about consumer credit card debt in Experian's credit card study.

Student Loan Debt

Student loan debt experienced one of the most significant changes in 2020, with overall outstanding debt growing to $1.57 trillion. That's an increase of 12%, or $166 billion, in just a year's time.

  • The average FICO® Score for someone with a student loan balance in 2020 was 689.
  • Washington, D.C., had the highest average student loan balance of $60,666 in 2020.
  • Alaska saw the greatest increase in average student loan debt in 2020 at 14%.

This growth stands out for two reasons: Not only is it the greatest percentage movement of any debt, but it's double the growth that occurred in that category in 2019. Though these figures may seem shocking, the growth can likely be attributed to the pandemic policies created to pause federal student loan repayment. With most student loans in forbearance or deferral, continued borrowing was simply added to existing balances that weren't being paid down.

Student Loan Delinquency Rates
Delinquency Period20192020Percent Change
% of accounts 30-59 DPD0.04%0.02%-50%
% of accounts 60-89 DPD0.14%0.10%-28.6%
% of accounts 90-180 DPD5.75%0.30%-94.8%

Source: Experian

Student loans saw reductions in delinquency rates across the board, with the ratio of severely delinquent accounts (90 to 180 DPD) dropping by more than 90% in 2020. Members of Generation X carried the highest average student loan balances, followed by baby boomers and millennials.

Student Loan Debt by Generation
GenerationBalance
Generation Z$17,338
Millennials$38,877
Generation X$45,095
Baby boomers$40,512
Silent generation$28,052

Source: Experian

Read more about student loan debt in Experian's student loan study.

Mortgage Debt

The housing market continues to see a pandemic boom caused in large part by historically low mortgage interest rates. Due to the spike in demand, home prices have increased, and in September 2020, homebuying website Zillow reported that 1 in 5 homes sold above their listing price.

  • The average FICO® Score for someone with a mortgage in 2020 was 735.
  • Washington, D.C., had the highest average mortgage balance of $439,280 in 2020.
  • Idaho saw the greatest increase in average mortgage debt in 2020 at 8%.

This competitive market along with consumers' desires to buy homes resulted in significant growth in mortgage debt. Overall mortgage debt rose to $10.3 trillion in 2020, up $703 billion (7%) from the previous year.

Mortgage Delinquency Rates
Delinquency Period20192020Percent Change
% of accounts 30-59 DPD1.53%0.80%-47.7%
% of accounts 60-89 DPD0.49%0.23%-53.1%
% of accounts 90-180 DPD0.47%0.29%-38.3%

Source: Experian

Mortgages also saw delinquencies drop across all categories, improving the most for medium severity delinquencies (60 to 89 DPD), which have dropped by 53% since 2019. While all debts saw delinquencies decrease in 2020, the improvement in mortgage accounts can likely be attributed to the CARES Act's mandates that lenders allow a forbearance option for consumers impacted by the pandemic. Similarly to student loans, with more mortgages in forbearance, fewer balances become past due and thus rates of delinquency drop.

Broken out by generation, members of Generation X maintained the highest average mortgage debt. However, members of Generation Z—the consumers with the lowest mortgage balances—saw the largest increase in their home loan debt, spiking by 19% in 2020.

Mortgage Debt by Generation
GenerationBalance
Generation Z$169,470
Millennials$237,349
Generation X$247,564
Baby boomers$178,688
Silent generation$133,827

Source: Experian

Read more about consumer mortgage debt in Experian's mortgage study.

Auto Loan Debt

Though auto loan debt saw a 3.8% increase in 2020, growing by $54 billion to a total of $1.35 trillion, trends in auto loan borrowing remained relatively stable in the past year. In 2019, auto debt increased by 4% and this rate had been on a downtrend since 2014 (when auto loan debt grew 12% year over year).

  • The average FICO® Score for someone with an auto loan balance in 2020 was 712.
  • Wyoming had the highest average auto loan balance of $25,474 in 2020.
  • West Virginia saw the greatest increase in auto debt in 2020 at 6%.
Auto Loan Delinquency Rates
Delinquency Period20192020Percent Change
% of accounts 30-59 DPD2.11%1.56%-26.1%
% of accounts 60-89 DPD0.65%0.51%-21.5%
% of accounts 90-180 DPD0.33%0.36%+9.1%

Source: Experian

Though debt didn't see much change in its pattern of growth since last year, delinquency rates for auto loan borrowers were still down. Notably, however, was the fact that long-term delinquencies—those 90 to 180 DPD—grew by over 10%. This makes auto loans the only category of debt to see any increase in delinquency in 2020.

Across the generations, members of Generation X had the highest average debt balances, followed by baby boomers and millennials.

Auto Loan Debt by Generation
GenerationBalance
Generation Z$15,724
Millennials$19,011
Generation X$22,307
Baby boomers$19,306
Silent generation$14,750

Source: Experian

Read more about auto loan debt in Experian's auto debt study.

Personal Loan Debt

Personal loan debt also saw significant change in 2020, with overall balances' typical annual growth cut in half. Total outstanding personal loan debt grew to $323 billion in 2020, increasing 6% since 2019. Balances still climbed during the pandemic, but this 6% growth is just half of the 12% growth that occurred in 2019.

  • The average FICO® Score for someone with a personal loan in 2020 was 689.
  • Washington state had the highest average personal loan balance of $28,450 in 2020.
  • Washington, D.C., saw the largest decrease in personal loan debt in 2020 at 19%.

This shift indicated that while consumers are still applying for and receiving personal loans, this borrowing has slowed. Personal loans were one of the fastest growing debts in 2019, and this trend has the potential to return as the economy starts to bounce back and consumer borrowing returns to normal.

Personal Loan Delinquency Rates
Delinquency Period20192020Percent Change
% of accounts 30-59 DPD1.46%1.11%-24.0%
% of accounts 60-89 DPD0.78%0.65%-16.7%
% of accounts 90-180 DPD1.37%0.89%-35.0%

Source: Experian

Along with personal loan balances increasing, delinquencies were down in 2020. The ratio of accounts 90 to 180 DPD saw the greatest improvement, shrinking by over 35%. Across the generations, baby boomers carried the highest personal loan debt of any age group. Again, it's notable that the youngest generation—Generation Z—grew their average debt the most, increasing their personal loan balance by 33% in 2020.

Personal Loan Debt by Generation
GenerationBalance
Generation Z$6,004
Millennials$12,306
Generation X$17,733
Baby boomers$19,700
Silent generation$17,123

Source: Experian

Read more about personal loan debt in Experian's personal loan study.

HELOC Debt

Debt on home equity lines of credit (HELOCs) has been on a consistent downward trend for the past decade, with the debt last recording an increase in 2009. Since then, balances have consistently trended downward, and in 2020 the debt decreased by 11% to a new low total of $374 billion.

  • The average FICO® Score for someone with a HELOC in 2020 was 777.
  • Hawaii had the highest average HELOC balance of $70,090 in 2020.
  • Washington, D.C., saw the greatest decrease in HELOC debt in 2020 at 14%.

The decrease in 2020, while in line with the decade trend, was a notably bigger drop than what has occurred in recent years. Compared with the average decrease of 4% in the past five years, this year's decline was nearly triple.

HELOC Delinquency Rates
Delinquency Period20192020Percent Change
% of accounts 30-59 DPD0.40%0.28%-30%
% of accounts 60-89 DPD0.14%0.10%-28.6%
% of accounts 90-180 DPD0.20%0.17%-15.0%

Source: Experian

Along with declining balances, HELOC accounts have seen fewer late payments. The ratio of recently delinquent accounts—those 30 to 59 DPD—declined by roughly 30% in 2020. Across generations, members of Generation X held the most HELOC debt, followed by baby boomers and millennials.

HELOC Debt by Generation
GenerationBalance
Generation Z$36,107
Millennials$40,496
Generation X$46,660
Baby boomers$41,498
Silent generation$35,929

Source: Experian

Credit and Debt Trends in Changing Times

Though initial data shows that debt is rising and not yet impacting average credit scores, it's important to recognize that this data is a snapshot taken during a turbulent period. Additionally, most of these changes occurred over a period of less than a year and are subject to further change as time goes on.

This analysis looks at the most recent (upon date of publication) data from Q3 2020 and compares it with an annual snapshot for 2019 and other years cited. Experian will continue to monitor changes to consumer credit reports and will provide updates when notable change occurs.

Methodology: The analysis results provided are based on an Experian-created statistically relevant aggregate sampling of our consumer credit database that may include use of the FICO® Score 8 version. Different sampling parameters may generate different findings compared with other similar analysis. 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.

FICO® is a registered trademark of Fair Isaac Corporation in the U.S. and other countries.