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

Sources: Bloomberg, Federal Reserve Board, and Wells Fargo Investment Institute. Consumer balance sheet data as of June 30, 2022. Household debt service ratio and household net worth: quarterly data from January 1, 1980 to June 30, 2022.

Key Takeaways

  • Overall, consumer finances are holding up better than they did during the Global Financial Crisis, despite recent declines in stock and bond prices. Support has come from ample savings, rising home values, and respectable gains in earned income.
  • Overall strength among working households, particularly those with high incomes, has masked financial distress among families in lower income groups pressured by the squeeze on households’ inflation-adjusted incomes.