CENTRAL INDIANA BUSINESS

More U.S. households fell behind on debt in 2025 as inflation squeezed budgets

CBS News reported on Oct. 12, 2026 that nearly 20% of U.S. households were late on a debt payment in 2025, up from about 12% in 2022. The story cites rising credit-card, mortgage and auto delinquencies and survey evidence that inflation is driving larger credit-card balances.

BUSINESSINDY BRIEFBy BusinessIndy Editorial StaffCommentsPublished October 12, 2026 at 4:34 PM EDT

AI-generated illustration of the topic: More U.S. households fell behind on debt in 2025 as inflation squeezed budgets — AI illustration · Not a photograph of the reported event.

CBS News (Oct. 12, 2026) reported that nearly 20% of U.S. households were late on a debt payment in 2025, up from roughly 12% in 2022, and that almost 9% of households spent more than 40% of their income on debt repayment in 2025 — the highest share since 2010 (CBS News / New York Fed data cited). https://www.cbsnews.com/news/household-debt-delinquencies-rise-inflation/

The report also cites sector and demographic details: credit-card delinquency among people over 70 was the highest since 2011, the share of auto-loan accounts in delinquency for those over 70 reached a New York Fed-era high, mortgage delinquencies were at a six-year high, student loan delinquencies rose after pandemic-era protections ended, and surveys (Debt.com, University of Michigan) found many consumers using credit cards for basic needs and intending to cut spending.

WHY IT MATTERS

What changed and who this affects: more U.S. households were recorded as falling behind on at least one debt payment in 2025, and a larger share of income is going to debt service than at any time since 2010, according to reporting that draws on New York Fed data and consumer surveys cited by CBS News.

Why that matters to people and businesses: when more households are late on payments or divert a bigger share of income to debt, they have less spare cash to handle emergencies or to spend on goods and services. The report links the trend to inflation outpacing wage gains and to consumers using credit cards to meet basic needs (Debt.com survey), which can raise interest costs and deepen cash‑flow pressure.

How to follow this story: watch updated household debt and delinquency releases from the New York Fed and recurring consumer surveys such as the University of Michigan Surveys of Consumers, which the CBS piece cited for consumer outlooks. Policy changes, interest-rate shifts or new repayment programs (for example, in student lending) are plausible next milestones that could alter these trends.

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Research sources

CBS News MoneyWatch: Squeezed by inflation, more Americans are falling behind on their debts ↗

Linked source published October 12, 2026 at 4:29 PM EDT. Prepared with AI assistance from the linked research; material claims remain attributed in the article.

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