Households Cutting Debt, Increasing Net Worth
December 6, 2012, Written By Bill Hardekopf
The latest Flow of Funds Report from the Federal Reserve points to several positive economic trends.
Household net worth rose by $1.7 trillion to $64.77 trillion. This was a 2.7 percent
increase and was mainly due to higher home prices.
In addition, household debt decreased at an annual rate of 2.0 percent in the third quarter, falling $65.5 billion to $12.87 trillion. This was the largest decline since the second quarter of 2011. It followed a 1.2 percent increase during the second quarter of this year.
Home mortgage debt dropped by 3 percent.
Other forms of consumer credit, such as car loans and student loans, increased at an annual rate of 4 1/4 percent, the eighth consecutive quarterly increase.
About Bill Hardekopf
Bill Hardekopf is the CEO of LowCards.com and covers the credit card industry from all perspectives. Bill has been involved with personal finance for over 15 years. He is a frequent contributor to Forbes, The Street and The Christian Science Monitor.
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