One in seven US households has negative net worth, according to Bloomberg. It was based on a new report by the New York Federal Reserve. According to Bloomberg, “about 14% of US households have a credit card balance of more than $10,000, and student loan balances have soared. From the middle of 2008 to the middle of 2016, Americans’ total student loan debt went from $590 billion to $1.26 trillion.”
Surprisingly, the Fed report found that mortgages were a minor factor for the one in seven. It is common for young households who buy their first house to have negative net worth for a few years, but the report says the main reason for the negative worth is credit cards and student loan debt. Only about one in five households with negative worth own homes. Last year, an infographic was published by the FINRA Investor Education Foundation. It's a good summary of the financial state of affairs of US households.
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