Americans Managing Personal Debt Better, Study Suggests

The number of homeowners who are behind on their monthly mortgage payments by two months or more fell 9 percent this year, suggesting that Americans may be getting a better handle on their debt, NBC News reported Aug. 9.

In addition, households now spend about 11 percent of their disposable income to pay down all forms of debt, and were using fewer credit cards in the month of June compared to last year, according to data from the Federal Reserve.

Those trends may mark “a shift in consumers’ attitudes towards debt,” according to Paul Edelstein, an economist at IHS Global Insight.

Despite this, the average worker’s debt-to-income ratio has continued to rise because wages have not yet risen to meet increased worker productivity, studies show. But that may be starting change.

“Workers are working harder but getting a little more money as well,” says Joel L. Naroff, chief economist at Naroff Economic Advisors. “But workers, who are facing limited job openings, will also see their incomes grow minimally. That does not bode well for future consumer spending or economic growth.”

Of all major debt categories, only student-loan debt continues to rise — now at the level of $1 trillion and rising — the federal data shows.

(Photo © meddygarnet via Flickr)