Debt Increases in Q3 for 27% of Consumers Carrying Balances

A growing number of consumers are finding it harder to reduce their debt due to persistent economic pressures, according to the latest Achieve Center for Consumer Insights Household Debt and Credit Study for the fourth quarter of 2025. The survey found that 69% of consumers with debt saw their balance either increase or remain unchanged over the past three months, while only 31% managed to lower their total debt.

More than one-quarter of consumers carrying balances (27%) reported taking on additional debt, up from 22% in the previous quarter. The findings suggested that a rising share of households are leaning on credit cards and short-term loans to manage daily expenses amid high interest rates and elevated prices.

“The latest survey demonstrates the elevated financial strain many American households are currently facing,” said Brad Stroh, Achieve’s co-founder and co-CEO. “Many Americans were facing financial pressures even before the government shutdown put additional stress on a large segment of the economy.”

Signals from other corners of the economy reflect similar pressure. Surveyed middle-class households said they could still absorb rising prices and unexpected expenses, but their overall financial well-being was slipping, according to the American Council of Life Insurers.

Foreclosure activity is also accelerating—filings have increased year-over-year for six consecutive months since August and were up 18% from the same period in 2024, according to property data firm Attom. In the first half of 2025, approximately 188,000 properties had foreclosure filings, putting the country on track to surpass the 322,000 filings recorded in 2024.

Struggle to Pay Down Balances, Cover Essentials

Achieve’s study found that 54% of consumers carrying balances used credit cards to cover essential expenses such as groceries, gas and utilities, with 28% having carried this debt for at least six months. Financial confidence declined, with 58% of respondents rating their financial situation as “poor” or “fair,” and one-third saying they could not pay all their bills on time each month.

As for paying down debt, 41% of respondents said it would take them more than a year to pay off what they owed, up from 37% in the previous quarter, while only 42% believed they could clear their debts within six months or less.

Among consumers carrying balances who said it was difficult to pay bills on time, 67% cited insufficient income to cover expenses, 32% said they owed money on too many accounts, 24% pointed to difficulties managing cash flow, and 11% reported trouble keeping track of how much they owed across accounts. Job losses and income reductions remained the top reasons for missed payments, followed by higher essential costs and financial literacy challenges.

As financial pressures mount, retirement plan advisers say consumers will increasingly need integrated support that goes beyond basic financial products.

“The future is integration, automation and delivering customized guidance at scale,” said Sean Bjork, president of Bjork Asset Management and a 2025 PLANADVISER Top Retirement Plan Adviser, in a previous interview. “Most financial benefits flow through the workplace, yet employees are left alone to navigate often wildly complex choices. A decade from now, the best advisers will help businesses optimize their benefit spend and guide employees toward financial resiliency and confidence.”

The Achieve survey was conducted in September 2025 and reached 2,000 U.S. adults with active consumer debt accounts, including credit cards, car loans, mortgages and student loans. The sample also included a statistically significant group of borrowers who had been at least 30 days delinquent on credit card, car or student loan payments within the past six months.