America’s Rising Debt: A Growing Concern

Debt in America has reached staggering levels, reshaping the financial landscape for millions of households. According to the Federal Reserve Bank of New York’s most recent report, total household debt now stands at $18.39 trillion, an increase of $185 billion in just the second quarter of 2025 alone.

The Breakdown of Debt Growth

The biggest contributor continues to be mortgages, which rose by $131 billion and now account for nearly $12.94 trillion of the total debt load. But mortgages aren’t the only area of concern.

• Credit card balances surged by $27 billion, hitting an all-time high of $1.21 trillion, up almost 6% from the previous year.

• Auto loans climbed by $13 billion to reach $1.66 trillion.

• Student loans edged upward to $1.64 trillion.

This rise isn’t just about numbers on paper—it reflects households carrying heavier financial burdens across nearly every debt category.

Warning Signs: Delinquencies and Bankruptcies

Alongside this growth, delinquencies are also creeping higher. Roughly 4.4% of all household debt is now delinquent, with student loans leading the pack—over 10% of student loan debt is 90+ days overdue.

The report also noted that more than 131,000 consumers filed for bankruptcy in Q2 2025, marking an increase from the prior quarter.

These numbers highlight a troubling reality: while access to credit can fuel spending and homeownership, many families are struggling to keep up with payments.

The Bigger Picture

Since the end of 2019—just before the pandemic recession—household debt has increased by $4.24 trillion. Rising interest rates, inflationary pressures, and wage stagnation are forcing families to rely more heavily on credit to cover everyday expenses.

The result is an economy where debt, once seen as a tool for opportunity, is becoming a barrier to financial freedom.

Looking Ahead: Finding Solutions

At S&S Life and Financial Services, we believe debt doesn’t have to define your financial future. In our next newsletter, we’ll explore strategies to break free from the cycle of debt, including:

• The Snowball Method – a step-by-step approach to pay down debt quickly.

• The Modified Debt Snowball (using life insurance) – leveraging a smart financial tool to accelerate debt elimination.

• Solo 401(k) for Business Owners – turning retirement planning into a debt-fighting strategy.

Stay tuned as we share practical, faith-based, and proven strategies to help you move from financial bondage to financial freedom.