15 Surprising Ways Personal Loan Debt Varies by Generation

Here’s a sobering statistic: Consumer debt in the U.S. increased by 4.4% between 2022 and 2023. The total amount of debt Americans owe? $17.1 trillion.

While the majority of that $17.1 trillion is tied to mortgages, $1.07 trillion is in credit card debt, which is traditionally considered among the worst kind of debt. That represents a 15.3% increase from 2022 to 2023.

Consumer credit reporting company Experian conducted a study to better understand consumer debt in the United States. They analyzed consumer debt using their personal consumer credit database, with their findings on personal loan debt by generation being particularly notable.

1: Most Debt

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Baby boomers have the most personal loan debt of the five generations Experian assessed (Generation Z, millennials, Generation X, baby boomers, and the silent generation).

As of 2023, baby boomers held an average of $22,551 in personal loan debt. That’s a 4.2% increase from 2022, which is the second-lowest increase of the five generations studied.

2: Close Contender

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Generation X is neck and neck with the baby boomer generation in an unwanted way. They held an average of $22,259 in personal loan debt at the end of 2023, which is only $292 less than baby boomers.

What’s even more troubling for Gen X is that they saw nearly double the increase in credit card debt change compared to baby boomers, with a 7.7% uptick in personal debt.

3: Looking Better

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The silent generation’s $18,547 in personal loan debt for 2023 sounds relatively low compared to that of baby boomers and Gen X.

But what’s an even bigger relief is that, according to Experian, the silent generation only had a 1.8% increase in change between 2022 and 2023.

4: Fourth Place

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Millennials had the second-lowest personal loan debt of the five generations in Experian’s study. Their average personal debt as of 2023 was $16,669.

The problem? Millennials had a 10.4% increase in debt from 2022. Whereas their debt hovered close to $15,100 in 2022, it increased by over $1,600 in 2023.

5: Young and in Debt

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With $8,710 in personal debt in 2023, Generation Z appears to be sitting relatively better than older generations. But as we’ll soon cover, looks aren’t always as they seem.

For starters, Gen Z experienced a 13.4% increase in debt from 2022 to 2023. That’s the highest one-year increase last year among all five generations.

6: Gen Z Digging a Hole

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According to the New York Fed, Gen Z is more behind on their debt payments than any other generation. For the purposes of their assessment, “behind” meant that a payment was more than 90 days late.

The CEO of Cornerstone Wealth Consulting Services Jason Berube commented that it’s easy to understand why Gen Z is struggling to make timely debt payments. He cites economic instability at a time when this generation is trying to start their careers and the increasing cost of student loans as reasons for many failing to pay their monthly debt bills on time.

7: Number Illusion

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Gen Z’s relatively low average personal debt sum is misleading at first glance. Time isn’t on a young person’s side to help them build credit. So, their first credit cards or personal loans often have a low available credit amount.

This, coupled with Gen Z not having years under their belt where they could potentially rack up debt, helps explain why the total debt they owe is relatively low. The bottom line? Gen Z “only” having $8,710 in average personal loan debt in 2023 is nothing short of troubling for the future of this generation.

8: Minimum Payment Trap

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Finance experts say there are several reasons why many baby boomers have high personal loan debt. One of the biggest reasons is that they’ve had years of making minimum monthly payments if they chose to.

Making minimum payments can feel like relief at the time. However, high interest rates that accumulate year over year have devastating consequences in the long run.

9: Not a Student, But

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Another reason that some baby boomers have such high personal loan debt is that it comes in the form of student loans. Why would so many boomers still have student loans, you ask? Look at their kids and grandkids.

Some kind-hearted baby boomers offer to take on student loans or be student loan co-signers in their older years in the name of helping their kids or grandkids through college.

10: Big Spenders

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Gen X happens to be the biggest spender among generational cohorts, which helps explain why they have average personal loan debt that’s nearly on par with baby boomers.

That’s not to say all of Gen X is spending on unnecessary items, though. On the contrary, many find themselves in a position where they’re still paying a mortgage and raising children while looking after their aging parents.

11: Not So Shabby

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With intentional planning and a bit of luck, all hope isn’t lost for Gen Xers with personal loan debt. Based on the Bureau of Labor Statistics’ Consumer Expenditure Surveys, Gen X made an average of $108,615 post-taxes in 2022.

Furthermore, with around 70% of Gen Xers being homeowners, it’s reasonable to assume that as this generation gets their mortgage paid off, they’ll have more money to put towards paying down their personal loan debt.

12: Credit Score

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While not as current as their 2023 personal debt assessment, Experian ran a study analyzing interesting data on credit card debt and generations. One of the first takeaways was the average VantageScore (credit score.).

It turns out credit scores increase with age. The silent generation had the highest average VantageScore of all generations, at 729. Baby boomers followed with 716, Gen X with 676, millennials with 658, and Gen Z with 654.

13: Credit Card Ownership

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According to Experian’s data, baby boomers hold the greatest number of credit cards, with an average of 3.45 cards per individual. Gen X followed, with 3.3 cards.

Gen Z had the lowest average number of credit cards to their name (1.64 cards). However, as previously discussed, this could be because this generation is starting to build credit, so it might not be as easy for them to own multiple credit cards even if they would like to.

14: Utilization Rates

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Keeping your credit card utilization rate at or below 30% is what many financial experts recommend to avoid a negative impact on your credit score. All but one of five generations that Experian ran data on met this criteria. The outlier? Gen X, with a 32% average revolving credit card utilization rate.

The silent generation had the lowest utilization rate, at 13%. Boomers had the second-best (24%). Gen Z and millennials were tied, with a utilization rate of 30%.

15: Delinquency Rates

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Gen X has the worst past-due credit card delinquency rates of all generations in all three categories (30 to 59 days past due, 60 to 89 days past due, and 90 to 180 days past due). In contrast, the silent generation consistently had the lowest delinquency rates.

Baby boomers varied significantly in their average past due delinquency rates among the credit cards they held; 3.3% had cards 30 to 59 days past due, 1.8% had cards 60 to 89 days past due, and a massive 5.3% had cards 90 to 180 days past due.

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