Median family income rises 7 percent as loan delinquencies surge
Between 2022 and 2025, real median U.S. family income rose 7 percent to $82,200, while median net worth grew 2 percent to $215,900. Concurrently, the share of indebted families behind on loan payments jumped from 12.2 percent to 19.6 percent, according to the Survey of Consumer Finances.
Higher median incomes, divergent balance sheets
Real median family income rose 7 percent between the 2022 and 2025 surveys to $82,200, while real mean income declined 6 percent to $145,200. This shift reflected modest income gains in lower percentiles alongside declines at the top, narrowing overall income inequality.
In contrast, wealth inequality reinforced demographic divides despite a 2 percent rise in aggregate median net worth to $215,900. Families younger than 35 experienced a 23 percent drop in median net worth to $33,000, driven by declining business equity.
Conversely, families aged 75 and older registered a 37 percent surge in median wealth to $504,900, propelled by retirement account values.
Homeownership remained stable at 65.6 percent.
Borrowing costs squeeze household cash flows
Rising borrowing costs substantially worsened household debt fragility between 2022 and 2025.
Average interest rates climbed from 4.2 percent to 6.7 percent for 30-year fixed mortgages and from 14.6 percent to 21.4 percent on credit cards.
Consequently, the share of indebted families late on loan payments jumped from 12.2 percent to 19.6 percent, with those two months late reaching 8.2 percent.
Furthermore, 8.6 percent of families faced debt service payments exceeding 40 percent of income, the highest share since 2010.
Paper wealth masks cash flow fractures
Headline wealth gains mask an acute demographic divide across American households.
Paper asset growth provides zero liquidity to families struggling with higher borrowing costs.
Surging loan delinquencies prove that restrictive interest rates are inflicting severe damage on vulnerable borrowers.