Federal Reserve finds U.S. family debt delinquency at post-recession high

The Federal Reserve reported Friday that American households are falling behind on debt payments at levels not seen since the aftermath of the 2008 financial crisis. The central bank's triennial Survey of Consumer Finances shows a significant deterioration in the ability of families to meet financial obligations, despite a slight narrowing in wealth disparities.

The survey indicates that the portion of families behind on loan payments at the end of 2025 soared to nearly 20%, up from about 12% in the prior survey. This represents a gain of approximately 67%. Families behind by two months or more also accelerated, moving to more than 8% from 5% in 2022. The Fed noted that families were more likely to be behind on financial obligations than at any point since the 2010 survey, a period when the nation was emerging from the Great Recession.

The report highlights a sharp increase in the share of debt to income. Families with payment-to-income ratios greater than 40% jumped to 8.6%, up from 6.5% in 2022 and the highest level since 2013. This financial strain persists even as the New York Fed survey released earlier this week showed households reporting their financial situations had worsened from a year ago and were likely to be weaker in the year ahead.

Income trends revealed in the data show a divergence between median and average figures. While real median family income increased by 7%, average income dropped by 6%. The Fed attributed this to income gains among lower-income groups and declines among higher earners. Specifically, families in the lower ends of the income and net worth distributions saw modest increases, while those in the upper ends saw declines, indicating that income inequality decreased slightly between surveys.

Age groups experienced varied outcomes. Income gains were particularly strong for families aged 75 or older, while those aged 35 to 44 saw a 25% drop, which the Fed linked to declines in capital gains income. Exceptions to the general rise in median income included Black non-Hispanic families, Asian families, and those toward the top of the income and net worth distributions, for whom both median and mean income fell.

Net worth metrics reflect continued concentration at the higher end. Inflation-adjusted average net worth increased by 7% to $1.24 million, while median net worth rose just 2% to $215,900. The report described net worth growth as much slower than in the prior report covering the 2019-2022 period. Education levels drove considerable disparities, with those holding a college degree earning 1.9 times the median income of those with some college education and holding nearly three times the median net worth. Meanwhile, families in the bottom one-fourth of income saw median net worth decline by 6% and average net worth fall by 4%.