In 2019, the average American mortgage debt was $213,599. This figure increased to $215,655 or by nearly 1% (0.96%) in 2020.
The average American holds $53,897 in personal debt, much of it tied up in mortgages. If mortgages are excluded, the average debt would drop to $16,720. Student loans and car loans make up the bulk of the non-mortgage personal debt, and the average person has more than $5,000 of debt in each category.
Even though household net worth is on the rise in America (at $141 trillion in the summer of 2021)—so is debt. The total personal debt in the U.S. is at an all-time high of $14.96 trillion. The average American debt (per U.S. adult) is $58,604 and 77% of American households have at least some type of debt.
So how much non-mortgage debt do Americans have? According to Northwestern Mutual's 2021 Planning & Progress Study, U.S. adults aged 18 and over who carry debt hold an average of $23,325 outside of their mortgages.
A good goal is to be debt-free by retirement age, either 65 or earlier if you want. If you have other goals, such as taking a sabbatical or starting a business, you should make sure that your debt isn't going to hold you back.
Federal Student Loan Debt by Age
Federal debt among 24-and-under borrowers has declined 3.6% since 2017. Federal borrowers aged 25 to 34 owe an average debt of $33,570. Debt among 25- to 34-year-olds has increased 6.1% since 2017. 35- to 49-year-olds owe an average federal debt of $43,208.
The average credit card holder in the U.S. had $5,668 in credit card debt in Q2 2021 — that's 1% higher than Q1 2021's $5,611 average. From the first Q1 2020 to Q2 2021, the average credit card debt per cardholder decreased by $766 or 12%. The average cardholder had $6,434 in Q1 2020.
But ideally you should never spend more than 10% of your take-home pay towards credit card debt. ... So, take a look at your budget and bank statements and calculate how much money you're spending monthly to pay down debt. If that amount is greater than 10%, you might have a problem.
The Consumer Financial Protection Bureau recommends you keep your debt-to-income ratio below 43%. Statistically speaking, people with debts exceeding 43 percent often have trouble making their monthly payments. The highest ratio you can have and still be able to obtain a qualified mortgage is also 43 percent.
The average American's savings varies by household and demographic. As of 2019, per the U.S. Federal Reserve, the median transaction account balance (checking and savings combined) for the American family was $5,300; the mean (or average) transaction account balance was $41,600.
Respondents to Schwab's 2021 Modern Wealth Survey said a net worth of $1.9 million qualifies a person as wealthy. The average net worth of U.S. households, however, is less than half of that.
The traditional rule of thumb from financial advisors is that by the time you reach age 40, you should have three times your salary in retirement savings. So, if you earn $60,000 per year, this means that you should have a total of $180,000 in your 401(k), IRAs, and other retirement-specific accounts.
Median retirement income for seniors is around $24,000; however, average income can be much higher. On average, seniors earn between $2000 and $6000 per month. Older retirees tend to earn less than younger retirees. It's recommended that you save enough to replace 70% of your pre-retirement monthly income.
Is being debt-free the new rich? Yes, as long as you have money and assets, in addition to no debts. Living loan-free is a fantastic way to stay financially secure, and it is possible for anyone.
Being debt free to start with means having minimal to no bad debts and average good debts. Being debt free doesn't mean you have no mortgage, bills, or car payment. It means you carry a manageable amount of debt, and are cognizant of your borrowing and DTI.
Mortgages. Mortgage debt historically has been considered one of the safest forms of good debt, since your monthly payments eventually build equity in your home. ... Generally speaking, your monthly mortgage payment (including any PMI — private mortgage insurance) should be less than 28% of your gross monthly income.
Although ranges vary depending on the credit scoring model, generally credit scores from 580 to 669 are considered fair; 670 to 739 are considered good; 740 to 799 are considered very good; and 800 and up are considered excellent.
Being mortgage-free can make it easier to downsize in other ways – such as going part time – and usually makes it cheaper and easier to buy and sell your home. Generally, a smaller mortgage gives you greater freedom and security.
A prime credit score falls within the range of 660 to 719, according to data from the federal Consumer Financial Protection Bureau (CFPB) Consumer Credit Panel. ... For example, Experian defines prime borrowers as those with credit scores of 670 or above.