The Federal Reserve reported that concerns about household income, wealth, and debt-related financial stress increased between 2022 and 2025.
US households experienced higher incomes and modest gains in overall wealth between 2022 and 2025, but a growing number faced financial pressure as inflation and borrowing costs weighed on their budgets, according to a new Federal Reserve survey.
The Fed’s latest Survey of Consumer Finances found that median family income, adjusted for inflation, increased 7% to $82,200 over the three years. However, wealth gains remained uneven, with families that were already wealthier, older, better educated, or higher-earning generally gaining more than others.
The survey, conducted largely in April and May 2025, covered a representative sample of around 4,300 US households. Published every three years, it tracks changes in family income, assets, debt,t and financial conditions.
“While most families experienced moderate increases in income and net worth, an increasing subset of families appear to have been experiencing financial stress,” the Fed said.
Wealth Gains Remain Uneven Across Households
Real median family net worth rose 2% to $215,900 between 2022 and 2025. However, households at the bottom of the wealth distribution struggled to build financial security.
The bottom quarter of households saw median net worth fall by more than 50%, from $3,800 in 2022 to $1,700 in 2025. Meanwhile, median wealth among Black families declined 25%, reversing part of the 60% increase recorded between 2019 and 2022.
Families whose primary member was older than 75 recorded a 37% increase in wealth, highlighting the uneven distribution of gains across generations. Older households often hold assets accumulated over decades, while younger families face challenges associated with forming households and buying homes.
The findings point to persistent wealth inequality, even as overall household income and net worth increased.
Debt Payments Put More Families Under Pressure
Although total household debt remained relatively stable and debt relative to assets declined, several measures showed that families were finding it harder to manage repayments.
The median debt payment as a share of family income rose by two percentage points to 15.4%. The total debt-to-income ratio increased to 94.9%, up from 89.4% in 2022.
The share of households spending more than 40% of their income on debt payments climbed to 8.6%, compared with 6.5% in the previous survey. That was the highest level recorded since 2013.
The Fed also found that the proportion of families reporting overdue loan payments rose sharply, from about 12% to nearly 20%. Meanwhile, the share using buy-now, pay-later services increased from 7% to 12%.
These figures suggest that some households are relying more heavily on credit or struggling to keep up with existing obligations, even as consumer spending has remained resilient.
Lower-Income Families See Income Gains, but Wealth Remains Vulnerable
Income growth was stronger among lower-earning households during the period. Real median income rose between 4% and 7% for the bottom 60% of families, while the top 10% of earners recorded a 6% decline.
The gains reflected conditions in the post-pandemic labour market, when employers in sectors such as healthcare, restaurants and other in-person services raised wages and offered bonuses to attract workers.
However, higher earnings did not necessarily translate into greater wealth for the least affluent households. Rising living costs and debt obligations can leave families with little money available to save or invest, even when their wages increase.
The Fed’s findings also showed that homeownership remained broadly stable at around 66%. Stock market participation slipped slightly, from 58% of families in 2022 to 56% in 2025.
A K-Shaped Recovery in Household Finances
The survey captures a period in which the US economy moved beyond the sharp swings of the pandemic years towards more moderate wage growth and continued gains in financial markets.
Economists have described this pattern as a K-shaped economy, in which households with existing assets or higher incomes continue to make progress while others struggle to keep pace.
The latest figures illustrate that contrast. Median income and overall net worth increased, yet the bottom quarter of households lost more than half their median wealth and more families reported falling behind on loan payments.
The Federal Reserve’s findings suggest that headline improvements in income and wealth do not tell the full story of household financial health. For many families, the ability to manage debt, cover everyday expenses, and build savings remains a significant challenge.
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Source: View of the facade as construction continues on the Federal Reserve Board building, in Washington, D.C., U.S., September 17, 2025. REUTERS/Ken Cedeno/File Photo Purchase Licensing Rights
