On average, the U.S. consumer is in good shape

Sources: Bloomberg, Federal Reserve Board, and Wells Fargo Investment Institute. Consumer balance sheet data as of June 30, 2021. Household debt service ratio: quarterly data from January 1, 1980 to March 31, 2021. Household net worth: quarterly data from January 1, 1990 to June 30, 2021.

Key Takeaways

  • Overall, consumer finances have held up far better than they did during the Global Financial Crisis. Support has come from ample savings, gains in wealth from rising stock and home values, the lift to cash flow from mortgage refinancing, and respectable gains in earned income.
  • Overall strength among working households, particularly upper-income households, masked extreme distress during the worst of the pandemic among large segments of the unemployed.