Debt consolidation hits record as Americans cope with rising costs

Key Points:

• A record nearly 15,000 consumers entered debt consolidation with Money Management International (MMI) in the first half of 2026, carrying an average balance of about $40,000, marking the highest year-to-date figure since 2017.
• Household debt in the U.S. has reached an all-time high of $18.8 trillion, with rising debt-collection lawsuits, increasing personal bankruptcies, and a personal saving rate at a low 2.7%, exacerbated by inflation-driven price surges.
• Younger Americans are disproportionately affected by debt, with Gen Z clients increasing by 35% and Millennials representing the largest share of MMI clients, averaging $43,533 in unsecured debt; credit card debt remains a major issue, with delinquency rates at levels not seen since the Great Recession.
• Many consumers try to consolidate debt using personal loans, but nearly half of new MMI clients still hold personal loans averaging $19,000, often leading to continued debt struggles due to recurring credit card use.
• Financial experts recommend zero-interest credit cards as a tool for paying off smaller debts within promotional periods, while those with larger balances or weaker credit should seek professional credit counseling services.