Debt is part of the average American's life, and you can start to accumulate it as young as your 20s.
New findings from Experian's 2020 State of Credit report show that the average Gen Z consumer (ages 24 and younger) has about $10,942 worth of debt, not including mortgages. Likewise, millennial consumers (ages 25 to 40) have an average of $27,251 in non-mortgage debt, presumably across credit cards, auto loans, personal loans and student loans.
If you own a home, your debt balances might skew higher than average: Homeowners in their 20s and early 30s have between $172,561 and $232,372 of additional mortgage debt.
Millennials and Gen Z represent a wide range of ages and credit profiles, but both include consumers in their 20s. Having more than $10,000 of debt might sound like a lot for someone at the beginning stages of their career, but it's not all bad as long as you're strategic with your pay-off plan.
Using Experian's latest data, CNBC Select looked at how much debt the average 20-something consumer has so you can see how you stack up.
The data shows that Gen Z's credit card balances decreased from $2,230 in 2019 to $2,197 in 2020, and the youngest consumers had fewer missed payments than their millennial, Gen X and Baby Boomer counterparts.
Life becomes a lot more demanding in your 30s, and last year's Experian data shows just what kind of toll this can take on your finances:
In 2019, these were the average debt balances by age group, including mortgages:
As you can see, from ages 23 to 39, there's huge potential for debt to increase. In the decade from your mid 20s to your mid 30s, your responsibilities ramp up as you prioritize your long-term goals. The desire to settle down, start a family, go on memorable vacations and/or relocate to higher cost-of-living areas with better job prospects might motivate your financial decisions more than in your early 20s, when priorities like graduating from college, finding your first apartment and learning to get by on an entry-level budget were most important.
Experian offers a free credit monitoring service that allows you to sign up without providing a credit card number and gives you a one-stop look at your entire borrower profile. See all of your credit cards and loans, plus their balances, in one place. Keep track of your on-time payments and monitor your accounts for fraudulent activity.
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Experian, Equifax and TransUnion
Yes, up to $1 million
Once you know where your credit stands, take steps to get your finances in order. Make a plan to pay off your debt, read advice about saving for retirement and learn the must-know credit card basics. That way, when you decide the next stop on your financial journey, you're well prepared for what's ahead.