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More U.S. households fell behind on debt payments as debt-service burdens rose, Fed and CBS report

The Federal Reserve's Survey of Consumer Finances found the share of families spending more than 40% of income on debt rose to 8.6% in 2025; CBS News MoneyWatch and New York Fed data reported higher late payments, rising card and auto balances, and spiking delinquencies among older Americans.

News BriefBy BusinessIndy News DeskCommentsPublished October 12, 2026 at 4:34 PM EDTLiving story · 3 sources

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The fraction of U.S. families with debt payment‑to‑income ratios above 40% rose to 8.6% in 2025 from 6.5% in 2022, the Federal Reserve’s Survey of Consumer Finances reported; the SCF also found about 77% of families held some form of debt in 2025.

CBS News MoneyWatch, summarizing Fed and New York Fed analysis, reported nearly 20% of households were late on a debt payment in 2025 (up from about 12% in 2022) and said credit‑card and auto‑loan delinquency rates for Americans over 70 reached multi‑decade highs.

WHY IT MATTERS

The Survey of Consumer Finances (SCF) measures families’ debt payment‑to‑income ratio — the share of monthly income used to make required debt payments — and the Fed’s finding that 8.6% of families spent more than 40% of income on debt signals elevated repayment strain for a measurable share of households. High debt‑service burdens make families more vulnerable to shocks such as higher interest rates, medical bills or job loss because a larger portion of income is already committed to servicing loans.

CBS News MoneyWatch and the New York Fed provide complementary snapshots: CBS reported that nearly one in five households were late on a debt payment in 2025 and that surveys found many Americans relied on credit cards for basic needs, while the New York Fed’s Q2 2026 data showed credit‑card and auto balances rose (credit card balances increased by $21 billion to $1.26 trillion; auto balances rose $28 billion to $1.71 trillion) even as total household debt edged down by $13 billion to $18.8 trillion. Those balance increases can push monthly payments higher and contribute to the higher share of households with large debt‑payment burdens.

The reporting also highlights heterogeneous pressure: CBS cited Fed and New York Fed analysis showing especially sharp increases in credit‑card and auto delinquencies among Americans over 70, and it linked a recent jump in student‑loan delinquencies to the end of pandemic‑era protections and changes in federal repayment policy (as reported by CBS). The New York Fed cautioned that some student‑loan delinquency statistics are distorted by re‑reporting of previously defaulted accounts.

Watch upcoming SCF releases and New York Fed updates for whether elevated debt‑service burdens and delinquencies persist or ease; those periodic reports are the next milestones for tracking household financial strain.

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Linked source published October 12, 2026 at 4:29 PM EDT. Published without independent factual verification. The linked source and public disclaimer identify that limitation. Prepared with AI assistance; source-dependent claims remain attributed in the article.

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