Household Net Worth, Debt and Credit Rose Significantly in Q2

U.S. total household net worth jumped $5.8 trillion to $141.7 trillion in the second quarter of 2021, according to the Federal Reserve’s Financial Accounts of the United States report, which was released Thursday (Sept. 23).

Most of the increase in quarterly household net worth came from a boost in stocks ($3.5 trillion), with real estate appreciation accounting for about $1.2 trillion of the upswing.

Debt and credit numbers were also up sharply in the quarter, according to the report. Consumers racked up $17.3 trillion in debt for the quarter ending June 30, while consumer credit grew 7.9% in the three-month period and mortgage debt increased 8% in Q2 of 2021.

The federal government’s debt rose to $28.5 trillion, according to the second-quarter report, up 9.6% from the first quarter, marking the biggest jump in those numbers since the government debuted the economic stimulus program in the second quarter of 2020.

State and local government debt was down slightly from quarter to quarter, from 3.5% in Q1 to 3.1% in the second quarter. Meanwhile, non-financial business debt was up 1.4% to $18 trillion in Q2.

Non-financial debt across all segments of the U.S. economy sat at $63.3 trillion as of the end of June, up 6.4% from the end of March. Q1’s total non-financial debt outstanding was up 6.7% from the end of 2020.

Related news: Fed Data Shows Household Worth up to $136.9T, Debt Climbs 6.5% in Q1

Households and nonprofits stood at $136.9 trillion for the first quarter of this year, according to a statistical release from the Federal Reserve in June. Directly and indirectly held corporate equities jumped $3.2 trillion in Q1, while the value of real estate rose $1 trillion.

Outstanding domestic non-financial debt hit $62 trillion in the first quarter, a 5.8% increase from the final results of 2020, and household debt reached $16.9 trillion in Q1, up 6.5%.

In May, the Fed found that almost one in four Americans was in a worse place financially than the year before, PYMNTS reported, up from 14% the previous year.