Over the past six months, a growing number of Americans from all income levels are facing difficulties managing their debt, according to data from the National Foundation for Credit Counseling (NFCC) and credit scoring firm VantageScore. Debt woes are affecting not just lower-income households but a broad cross-section of consumers, signaling deeper financial pressures than many might expect.
The latest surveys from the NFCC reveal that more than half of Americans have experienced a negative shift in their personal finances since early 2025. These difficulties are no longer isolated to those with lower earnings but are spreading across income brackets. Mike Croxson, CEO of NFCC (National Foundation for Credit Counseling), noted that the critical factor is not income but the total debt burden. “It really doesn’t matter on the income level. It’s really about the debt level,” Croxson shared, underlining how even higher earners are becoming vulnerable when their expenses outpace what they can sustainably pay.
This shift has manifested in several concrete behaviors underscoring financial stress. NFCC’s survey found a marked increase in damaging credit card habits over the past six months. The share of Americans making less than the minimum credit card payment rose from 8% in the spring to 13% by August 2025. Meanwhile, more borrowers are transferring balances between cards or consolidating debt with personal loans, a move that jumped from 4% to 8% during the same period. These tactics signal mounting strain as consumers attempt to manage growing debt loads and rising interest costs.
Financial anxiety is on the rise, too. Nearly 30% of those surveyed now believe their money situation will prevent them from achieving their life goals, a slight increase from 26% reported just months earlier. More Americans also feel that being in debt negatively impacts their decision-making in areas beyond finances, climbing to 63% in August from 53% in spring, indicating how debt stress infiltrates everyday life and well-being.
Credit data from VantageScore similarly points to worsening credit health. The average VantageScore credit score held steady at 702 in May 2025, but behind that static number, distress was mounting. Delinquencies, particularly those more than 90 days late, are rising sharply even among borrowers with the highest credit tiers. For instance, late-stage delinquencies more than doubled year-over-year within the VantageScore Superprime group, reflecting a broader spread of financial challenges. Mortgage and auto loan delinquencies have been especially notable, with secured loan balances climbing amid high inflation for homes and cars. Lenders are responding by tightening credit standards, signaling caution over the potential for further defaults.
Many consumers continue to rack up increasing balances despite expressing caution in spending. VantageScore data showed credit balances reached five-year highs for five consecutive months by mid-2025, suggesting that consumers are relying more heavily on credit even as economic uncertainty persists. Susan Fahy, EVP and Chief Digital Officer at VantageScore, noted that consumer behavior often diverges from sentiment: while many say they are uncomfortable spending, their credit balances tell a different story. This underscores the tension many feel between needing credit to manage expenses and the stress of carrying that debt.
The cumulative impact of these factors has raised the NFCC Financial Stress Forecast to a level not seen since before the pandemic. The forecast, measured on a 10-point scale, hit 6.6 in the second quarter of 2025, marking a sharp rise from the 3.2 low seen in 2021. This forecast reflects not just higher debt levels but the daily financial decisions many Americans now face, juggling payments for essentials such as housing, food, and healthcare alongside mounting debt obligations.
Taken together, these findings paint a complex picture of an economy where debt is no longer just a background issue for many households. Instead, it has become a daily challenge that affects a broad spectrum of Americans irrespective of income. As debt-related pressures increase, the risk of delinquencies and financial instability is growing, a trend that could have ripple effects across the financial system.
Experts urge consumers to seek help and manage debt proactively. The NFCC continues to promote resources and credit counseling services to support individuals overwhelmed by their financial obligations. For those struggling, early action with professional guidance remains essential to preventing deeper financial trouble down the line.
The rise in debt struggles across all income levels signals an important shift in the financial landscape for Americans. Managing debt is proving difficult for millions, not just those traditionally viewed as financially vulnerable. This reality calls for awareness and practical steps from both consumers and lenders to respond to the growing challenge before its impact becomes more widespread and severe.
