This is Mary Walden with economist MW, welcoming you to the economic perspective. Today’s program looks at the status of household debt. Mike, we worry about household debt for two reasons. First, at an individual level, we know that if we overdo it with using debt, it can wreak our personal finances. Second, if a lot of people overuse debt, it can bring down the economy. So where do we stand today with household debt?
Mike: Summary Answer
- In aggregate, household debt looks very good
- As a percent of household disposable income, well below levels during the recession; actually lower than pre-recession
- The largest component of hh debt – mortgage debt – has been stable
- Recent growth in hh debt has mainly been in two areas – auto loans and student loans
- Largest growth in student loans – up 139% since 2008
- Doesn’t imperil economic growth, impacts consumption by new graduates
- I’m MW
Mary: And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.