Chart: Household Debt Repayment to Disposable Personal Income Ratio
The Federal Reserve System has monitored this ratio ever since 1980. It shows the ratio between what households pay out quarterly to repay debt in relation to their disposable (after-tax) income.
This ratio has headed down sharply ever since the 2008 recession.
Here is the chart.
The statistics are here:
Look for DSR: Total.
The Federal Reserve's explanation is this.
1. The household Debt Service Ratio (DSR) is the ratio of total required household debt payments to total disposable income.2. The DSR is divided into two parts. The Mortgage DSR is total quarterly required mortgage payments divided by total quarterly disposable personal income.
As you can see, households are careful about the debt load they assume. The ratio peaked at 13% in 2008. It is now at its lowest level at slightly under 10%. This is not much of a variation, 1980-2013. At no time since 1980 has there been anything even remotely resembling a crisis in household debt.
What is significant is this: ever since late 2008, interest rates have fallen. But households have not borrowed more money. They could have afforded to borrow, because rates were falling. Household debt repayment would have stayed high. Instead, households have reduced their level of debt. They have used lower rates to increase their disposable income.
Household credit card debt has declined from $19,000 in 2009 to $15,000 today.