Personal Debt in America Had Dropped 25% in Three Years

US adults bearing personal debt held on average $22,354 excluding mortgages Beginning of the year, when inflation was already on the rise, but before the final spikes

MILWAUKEE, September 20, 2022 /PRNewswire/ — Personal debt among US adults 18 and older was on a three-year downward trend earlier this year, according to Northwestern Mutual’s 2022 Planning and Progress Study.

Mutuality in the Northwest.  (PRNews Photo/Northwestern Mutual)

Mutuality in the Northwest. (PRNews Photo/Northwestern Mutual)

Among adult Americans in debt, they held up on average $22,354 excluding mortgages in February when the survey was conducted. Inflation was rising at the time, but that was before recent spikes in economic data. Nonetheless, the long-term trend line showed a 25% decline over three years.

Average amount of personal debt (excluding mortgages)









“With inflation rising so rapidly since the 1980s, many Americans have seen their savings begin to erode and their debt mount in recent months,” he said Christian Mitchel, Executive Vice President and Chief Customer Officer at Northwestern Mutual. “It’s a challenging time for consumers, but on the bright side many people have deleveraged in recent years. It’s a good reminder that a strong financial plan needs to take into account both what’s happening now and what could be down the road.”

The drag effect
Debt can weigh on a financial plan that is very difficult to reverse. The study found that, on average, nearly one-third (32%) of Americans’ monthly income goes toward paying off non-mortgage debt.

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Aside from mortgages (18%), credit cards are by far the most important source of personal debt.

Sources of Personal Debt

credit cards


car loans

8th %

Loans for private education

8th %

Educational expenses for children/family members


Home equity loans/lines of credit


More than half (54%) of respondents say debt has a significant or moderate impact on their ability to achieve financial security, and many Americans expect to remain in debt for a long time.

How long people are likely to be in debt

1-5 years


6-10 years


11-20 years


For the rest of my life


I do not know


Debt has also caused people to miss many of life’s major milestones, including getting married, buying a home, having children, and saving for retirement.

Things people have delayed because of debt

Make a significant purchase


Saving for retirement


Buy a house



8th %

have children

8th %

“If debt is managed carefully, it can play a helpful role in a long-term financial plan — but it’s a slippery slope,” Mitchell said. “It can be hard to see when healthy debt turns into runaway debt, and once that line is crossed it can be crippling over a long period of time. A counselor can help, whether that’s avoiding runaway debt in the first place or helping out with it once it’s settled.”

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Americans prioritize paying off debt over saving
Between saving and paying off debt, 57% of people prioritize paying off debt versus 43% who put saving first.

“Everyone’s financial situation is different, but this finding is a pretty clear reflection of intentions,” Mitchell said. “This makes me optimistic that despite the challenges that inflation poses, people are focused on reducing their debt over time.”

About the 2022 Northwestern Mutual Planning & Progress Study
The 2022 Planning & Progress Study, conducted by The Harris Poll on behalf of Northwestern Mutual, included 2,381 American adults ages 18 and older who took part in an online survey at one point in time February 8th – 17, 2022. Results were weighted with census targets for education, age, gender, race/ethnicity, region, and household income. The propensity score weighting was also used to adjust respondents’ propensity to be online. Estimates of theoretical sampling error cannot be calculated; a full methodology is available.

About Northwestern Mutual
Northwestern Mutual has been helping people and businesses achieve financial security for more than 165 years. Through a holistic approach to planning, Northwestern Mutual combines the expertise of its financial professionals with a personalized digital experience and industry-leading products to help its clients plan for what matters most. With more than $561 billion in the combined company and client assets, $34 billion of income and $2.1 trillion Northwestern Mutual provides financial security to nearly five million people with life, disability and long-term care insurance, annuities, and brokerage and consulting services. Northwestern Mutual was ranked #97 on the 2022 FORTUNE 500 and was recognized by FORTUNE® as one of the “World’s Most Admired” Life Insurance Companies of 2022.

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Northwestern Mutual is the marketing name for The Northwestern Mutual Life Insurance Company (NM), Milwaukee, WI (life and disability insurance, pension insurance and life insurance with care allowance) and its subsidiaries. Its subsidiaries include Northwestern Mutual Investment Services, LLC (NMIS) (investment broking services), broker-dealer, registered investment adviser, member of FINRA and SIPC; Northwestern Mutual Wealth Management Company® (NMWMC) (investment advice and services), Bundessparkasse; and Northwestern Long Term Care Insurance Company (NLTC). Not all representatives of Northwestern Mutual are consultants. Only those agents with “Advisor” in their title or who otherwise disclose their status as advisors to NMWMC are authorized to act as NMWMC agents to provide investment advisory services.



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