Outstanding debt per household in the United States continues to hit all-time highs. The two leading forms of debt in the United States are that from credit cards and mortgages. The former is tracked by the Federal Reserve, whose most recent G.19 report puts the figure for revolving debt, which mostly reflects that from credit cards, at a record $1.023 trillion in November.
Mortgage debt is excluded from the Federal Reserve's monthly report, making it hard to get a full picture of the debt burden carried by U.S. households. We decided to take a look at how these two forms of debt have changed for the average American family over the past five years.
- Credit card debt per capita has risen by 9% since 2013. In that same time, total revolving debt has gone up by about 20% for the nation as a whole.
- Wyoming, Alaska and Montana had the highest increase in credit card debt per capita—rising by 73%, 68% and 67%, respectively.
- Credit card balances shrunk in just 10 of the 50 states: Maine, Rhode Island, Hawaii, Massachusetts, Maryland, Virginia, Minnesota, Illinois, Oklahoma and Georgia.
- Average mortgage debt among households with primary mortgages has declined by 4.6% nationally since 2013, with all but 12 states reporting some amount of decline locally.
- Only 12 states saw a growth in average mortgage debt: Hawaii, Colorado, Oregon, Idaho, Nebraska, Texas, South Carolina, Montana, Wyoming, North Dakota, Iowa, and Kansas.
- Rhode Island, Florida, and Connecticut reported the biggest decreases in primary mortgage debt, with averages falling by at least 10% in each state.
How Has Credit Card Debt Changed in the Last 5 Years?
Per capita credit card debt among those who carry a balance is up by roughly 9% since 2013 and total outstanding revolving debt, which mostly comprises credit card debt, is up by about 20% over that same time, according to the latest data released by the Federal Reserve. These data suggest that indebted households are only growing deeper in debt.
The change in card-balances over the past five years vary greatly from state-to-state. Consumers in Wyoming, Alaska, Montana and Utah all saw their average card balances jump by more than 60% since 2013. Per capita debt decreased in just 10 states— Maine, Rhode Island, Hawaii, Massachusetts, Maryland, Virginia, Minnesota, Illinois, Oklahoma and Georgia. Check below to see where your state ranks.
When looking at the data, we observed a correlation between changes in debt and how each state voted in the most recent presidential election. Eight out 10 states where average balances decreased were won by Hillary Clinton. Among states where debt rose, the average rise in debt was also significantly larger for red states than blue states — 24% versus 4%, respectively. Many of the red states where balances increased the most were located in the South. In our own recent study of the health of credit card debt in the United States—which looked at factors such as debt amount, number of balance-carrying households and delinquencies—southern states tended to performed worse than those in other regions of the country.
Revolving debt as a whole has increased substantially since 2013, and rose and fell in cycles before that time. It first peaked in 2008, just before the Great Recession. Shortly thereafter, outstanding debt crashed, and it only began to increase again around 2011.
|State||Average Credit Card Debt, 2018||Change Since 2013||Percent Change|
Change in Average Credit Card Debt, 2013 vs 2018
Average Mortgage Debt Declines Nationwide
In addition to credit card debt, we analyzed data on the average mortgage debt carried by U.S. households who currently have a primary mortgage. Over the past five years, the average primary mortgage debt has dropped by more than $7,000, to a total of $146,962. This represents a 4.6% decrease on the national level. While a decline in consumer debt is generally positive, the unique nature of mortgage debt suggests a more complicated picture.
Mortgage debt is significantly influenced by changes in housing values, which determine how much consumers must borrow to purchase new property. However, housing values and mortgage balances don't necessarily move in the same direction. In some cities, property values dropped after the 2008 financial crisis and have not fully recovered since, theoretically reducing the average balance of new purchase mortgages. Yet in places where property values have risen extremely rapidly, average mortgage debt might decline as high prices discourage the origination of new mortgages—all while older, lower-value mortgages continue to be paid off.
While in most states and the nation as a whole, average primary mortgage debt fell by some amount in the past five years, 12 states actually experienced an increase in average mortgage debt. In Hawaii, Colorado, and Oregon, the figure rose by more than $10,000 for the average first mortgage. On the opposite end of the spectrum, in Rhode Island, California, and Connecticut, the average mortgage debt dropped by at least $19,000.
The state data on mortgage debt further reinforces the local variation in property values. While most states reported declines in average debt, the dollar amount of these changes varied widely according to local prices. For instance, Tennessee and the District of Columbia experienced very similar percentage decline in the average primary mortgage balance of 4.8% and 4.7% respectively. However, these virtually identical proportions translated into drops in mortgage value of of $11,081 in DC as opposed to $6,041 in Tennessee.
When we looked at state averages for mortgage debt relative to political alignment in the 2016 presidential election, red states reported lower average mortgage balances than did states that voted for Clinton—$127,817 compared to $169,195. However, mortgage debt in red states also saw a much smaller average decrease of $2,241 (1.7%) since 2013, compared to a $7,842 (4.4%) drop in blue states.
|State||Average Mortgage Debt, 2018||Change Since 2013||Percent Change|
|District of Columbia||$226,773||-$11,081||-4.66%|
Change in Average Mortgage Debt, 2013 vs 2018
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We acquired geographic data on credit and mortgage debt from Claritas Financial CLOUT®. The data is based on survey responses from approximately 75,000 respondents across the nation.
Credit card data includes average balance for households with a Visa, MasterCard, Discover or American Express credit cards on which an outstanding balance can be carried from month-to-month. However, the data includes all such households, including those that do not carry a balance. For average mortgage balances, we sampled data for households with a first or primary mortgage made for the purposes of buying an owner-occupied home—excluding mortgages for investment properties, vacation homes, and raw land.