How Much Money Does America Borrow?

Do you have enough money put away to help cover bills if you experience an unexpected expense? While you may have money in your savings account, roughly 40% of Americans would need to borrow money to pay for an unexpected $1,000 expense.1

But just how much money is the average personal loan balance? And what’s the most common usage of these funds? Learn more about personal loan and credit usage in America with these recent statistics.

 

Among those who would need to borrow money to cover a $1,000 expense, 26% would use a credit card or personal loan.

 

Fewer millennials would have sufficient emergency savings funds to cover a $1,000 expense when compared to older generations, including baby boomers and generation X.1

 

Over the past 10 years, personal loans became the fastest growing form of consumer credit.

 

Personal loans are so common that about 22% of adults in America have this form of credit.3

 

Over half of Americans with a personal loan borrowed money to consolidate outstanding debts or refinance credit.

 

According to research published by TransUnion, the average personal loan balance decreased slightly in late 2020 to $6,092, down about $300 from 2019.4

 

While banks are the most common funding source, roughly one-third of those who took out a personal loan borrowed from an online lender.5

 

Other common personal loan uses include home improvement and car financing.2

 

Personal loans make up a small portion of the money borrowed in America each year. Other sources of financing include mortgages, auto loans and credit cards.

 

According to recent data, outstanding credit card debt in America is about $998.4 billion, compared to about $151 billion in personal loan debt.6,2

 

The average credit card balance in America is $5,525.6

 

References

1Ostrowski, J. (2021). Survey: Fewer Than 4 in 10 Americans Could Pay a Surprise $1,000 Bill From Savings.

2Schulz, M. (2021). Personal Loan Statistics.

3Lembo Stolba, S. (2021). Experian 2020 Consumer Credit Review.

4Komos, M. (2020). Credit Card Balances Hit a New Low: What That Means for the Holiday Shopping Season.

5Serio, A. (2021). Personal Loans Statistics.

6 Johnson, A. (2021). The Average Credit Card Balance Is $5,525. Here’s What You Need to Know.

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Bonnie is a Chicago transplant who's committed to seeing the world on a dime. As an avid news junkie with an affinity for finance, she loves to help others do more with less.

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