US Consumer Spending Could Hit a Roadblock Per This Data

By: Anneken Tappe · February 08, 2024 · Reading Time: 2 minutes

Proceed With Caution

The U.S. economy has proven incredibly resilient in the face of rising costs and elevated interest rates. The key driver keeping the economy on track: You, the American consumer. But some data show that cracks may start to emerge.

Delinquency rates on credit cards and auto loans have risen to their highest level in more than a decade, according to the Federal Reserve Bank of New York .

Diverging Data

Annualized, 8.5% of credit card balances and 7.7% of auto loan balances went delinquent in the fourth quarter of 2023, as higher borrowing costs weighed on consumers.

While these figures suggest increasing financial stress for American consumers, other data paint a rosier picture. In January, the U.S. added nearly twice as many jobs as expected. Wages are also on the rise, while the unemployment rate remains near record lows.

Zooming Out

Despite the increase in select delinquencies, the story looked differently for other loan types , including student loans and mortgages, where delinquencies remained below pre-pandemic levels. This contributed to the overall delinquency rate remaining well below pre-pandemic levels as well at 3.1%.

Looking for more stories like this? Check out On the Money — SoFi’s one-stop-shop for news, trends, and tips!

Check it out

Please understand that this information provided is general in nature and shouldn’t be construed as a recommendation or solicitation of any products offered by SoFi’s affiliates and subsidiaries. In addition, this information is by no means meant to provide investment or financial advice, nor is it intended to serve as the basis for any investment decision or recommendation to buy or sell any asset. Keep in mind that investing involves risk, and past performance of an asset never guarantees future results or returns. It’s important for investors to consider their specific financial needs, goals, and risk profile before making an investment decision.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. These links are provided for informational purposes and should not be viewed as an endorsement. No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this content.
Communication of SoFi Wealth LLC an SEC Registered Investment Advisor
SoFi isn’t recommending and is not affiliated with the brands or companies displayed. Brands displayed neither endorse or sponsor this article. Third party trademarks and service marks referenced are property of their respective owners.

TLS 1.2 Encrypted
Equal Housing Lender