Most Americans have some type of debt, but it appears younger adults are struggling to bring down their balances.
According to a study from Credit Karma, Generation Z, which is defined as people born between 1997 and 2012, accumulated a higher percentage of debt at the end of 2022.
The study shows that Generation Z had, on average, $15,796 of debt between March and May of 2022. It rose to $16,283 from October to December, a 3.08% increase.
Report: More than 100 million adults are paying off medical bills
More than 70% of people reported having bills directly with hospitals, which typically means a substantial balance.
While other generations have accumulated more debt over their lifetime, the rate their debt is increasing is still lower than the rate of Generation Z, the study says.
Student loan debt and auto loan debt appear to be the biggest chunk of debt for Generation Z. Young adults with student loan debt are carrying balances of about $15,000, on average. The average car loan is nearly $20,000, the report states.
It appears Generation Z is also falling behind on their bills. The report says it was the only generation to report an increase in past-due accounts from March to December 2022. However, it appears Generation Z may be doing just enough to hold off a call from a collection agency. The report notes that Generation Z had the lowest percentage of accounts going into collections from the beginning to the end of last year.
More Americans say they have more credit card debt than savings
More Americans say they would rely on credit cards in case of a sudden emergency than on personal savings.
