Almost 40% of US homeowners own their homes outright as of 2022—many of them baby boomers who refinanced when rates were low.
Around 23% of Americans are debt free, according to the most recent data available from the Federal Reserve. That figure factors in every type of debt, from credit card balances and student loans to mortgages, car loans and more. The exact definition of debt free can vary, though, depending on whom you ask.
40% of Americans Pay Off Their House — Are They Doing Better Financially? For most Americans, a home mortgage is the biggest financial obligation they will ever have. A traditional mortgage spans 30 years and is often in the hundreds of thousands of dollars, so the interest charges can be enormous.
According to Experian, average total consumer household debt in 2023 is $104,215. That's up 11% from 2020, when average total consumer debt was $92,727.
Percentage of Homeownership
The table below shows the percentage of homes without a mortgage compared to the total number of available homes on record from 2010 to 2022. 2 These figures show that the percentage of mortgage-free homes has increased steadily, from 32.78% in 2010 to 39.28% in 2022.
Running up $50,000 in credit card debt is not impossible. About two million Americans do it every year. Paying off that bill?
There is no specific age to pay off your mortgage, but a common rule of thumb is to be debt-free by your early to mid-60s.
The survey found that 63% of Americans can't afford to buy a home this year, with 87% of Gen Z unable to and 62% of millennials unable to.
Only 1.2% of Hawaiian homes and 0.6% of Californian homes have negative equity.
The Standard Route is what credit companies and lenders recommend. If this is the graduate's choice, he or she will be debt free around the age of 58. It will take a total of 36 years to complete. It's a whole lot of time but it's the standard for a lot of people.
So, for the purposes of the study, Bank of America set a threshold — households spending at least 90% of their income on necessities could be considered living paycheck to paycheck. By that measure, around 30% of American households are living paycheck to paycheck, according to Bank of America's internal data.
Who owns the most U.S. debt? Around 70 percent of U.S. debt is held by domestic financial actors and institutions in the United States. U.S. Treasuries represent a convenient, liquid, low-risk store of value.
With an average mortgage term of 30 years, this means that the average first-time buyer won't pay off their mortgages until they're 63 years and 8 months old. However, the age can differ depending on the region that the first-time buyer resides in.
"Becoming a homeowner has never felt harder." The average age of all homebuyers — first-timers and repeaters — has "risen by six years since July 2023," Mike Winters said at CNBC. That average age is now 56, up from 49 last year.
The share of home buyers paying all cash reached 33 percent through August this year, according to data from Redfin — one of the highest rates since the years following the Great Recession. “The demographics of buyers doing this is incredibly broad,” said Compass Realtor Megan Dwyer in Florida's Southeast coast.
In 2022, nearly 40% of U.S. homeowners owned their homes outright, according to Census Bureau data analyzed by Bloomberg. In total, 33.3 million single-family homes and condos were mortgage-free, a 31% increase compared to 25.4 million homes a decade ago.
What are rent prices expected to do next? "At a national level, the median asking rent price in the U.S. will likely stay flat over the course of a year in 2025, as new rental inventory becomes available," said NBC News, citing Redfin.
Now, Americans must earn roughly $106,500 in order to comfortably afford a typical home, a significant increase from the $59,000 annual household income that put homeownership within reach for families in 2020, according to new research from digital real estate company Zillow.
Age isn't a limiting factor, but your income and mobility may be. If you've built up your savings over the years, you may not want a mortgage, preferring to buy a house outright. How Much Is My House Worth? See your free home value estimate in less than two minutes.
For example, if you plan to travel frequently in retirement, you may want to aim for 90% to 100% of your pre-retirement income. On the other hand, if you plan to pay off your mortgage before you retire or downsize your living situation, you may be able to live comfortably on less than 80%.
At the close of 2019, the average household had a credit card debt of $7,499. During the first quarter of 2021, it dropped to $6,209. In 2022, credit card debt rose again to $7,951 and has increased linearly. In 2023, it reached $8,599 — $75 shy of the 2024 average.
According to the Federal Reserve's Survey of Consumer Finances (SCF) for 2022 (the most recent study released publicly), the average savings balance for people ages 64 and younger ranged from $20,540 to $72,520, with median balances ranging from $5,400 to $8,700.