America has a debt problem — and it may be worse for millennials

  • Debt is scarier than death, according to 42% of millennial respondents. 
  • 59% of millennials feel overwhelmed by the amount of debt they currently have and another 59% feel hopeless when it comes to paying down debt.
  • More than half of millennials feel like the financial system is set up to work against them, along with 50% of Gen Z. 

Debt has been thrust into the spotlight with the latest must-watch Korean drama that people can’t stop streaming — or talking about. The binge worthy series has spurred conversations about the debt crisis and income inequality experienced around the world. This concept of debt and the disparity of wealth has become even more relevant during the pandemic when the divide between the rich and the poor became increasingly apparent. 

Indebted and desperate, it seems nobody is exempt from the threat of crippling debt. However, some generations may be more at risk than others. 

According to a new study conducted by Qualtrics on behalf of Credit Karma, 59% of millennials say they feel overwhelmed by the amount of debt they currently have with another 59% saying they feel a sense of hopelessness when it comes to paying down their debt. Gen X+, on the other hand, were the least likely to report feeling overwhelmed by the amount of debt they currently have (48%), followed by Gen Z (44%). Gen Z and Gen X+ were also less likely than millennials to feel hopeless about their debt, with about 40% saying they did not relate to this feeling. 

What’s debt got to do with it?

The breakdown of debt across generations varies among respondents who were willing to report the amount of debt they hold across certain debt categories. For example, millennials and Gen X+ respondents who chose to disclose how much debt they owed in each category were likely to owe significantly more toward their mortgages and student loans, compared to their Gen Z counterparts. 

Here’s a breakdown of median debt held by generations among respondents who chose to disclose the amount of debt they hold in each of the below categories.   

Gen ZMillennialsGen X+
Credit card(s)$1,200$2,000$3,000
Auto loan(s)$10,500$8,566$12,250
Mortgages/ home loans$20,000$55,000$99,000
Medical debt $2,000$3,000$2,687
Personal loan(s)$1,000$2,000$5,000
Student loan(s)$12,000$11,000$20,000
Money owed to a collections agency$600$2,500$3,000
Money owed to a friend of family member$500$1,000$1,028
Line(s) of credit $1,000$2,350$5,000
*** Among respondents who chose to disclose their debt.

What kind of debt are we talking about? 

Among Gen X+ respondents, 68% reported having credit card debt, 36% mortgage debt, and 34% auto loan debt. Millennials, on the other hand, appear to have more debt across a broader range of categories, including personal loans, medical debt and student loans. They were also more likely to owe money to a collections agency or a friend or family member. Gen Z, still green to borrowing, are largely chipping away at credit card debt and student loans. 

Here’s a breakdown of the kinds of debt held by category and generation: 

Gen ZMillennialsGen X+
Credit card(s)49%64%68%
Auto loan(s)31%38%32%
Mortgages/ home loans15%25%36%
Medical debt 16%34%29%
Personal loan(s)19%35%22%
Student loan(s)48%34%15%
Money owed to a collections agency10%27%17%
Money owed to a friend of family member18%25%14%
Line(s) of credit 13%22%12%

Did you say debt or death? 

While associating debt with death might seem extreme, they may be more closely linked than one might think. According to the study, 42% of millennials say debt is scarier than death, along with 33% of Gen Z and 26% of Gen X+. That correlates closely to how in control of their debt each generation feels. According to the study, more than half of millennials say their debt feels out of control, compared to 42% of Gen Z and 36% of Gen X+. 

What’s “fair” got to do with it? 

Beyond feeling overwhelmed and hopeless when it comes to paying down debt, Millennials don’t think the amount of money they owe is fair. According to the study 53% of millennials think the amount of debt they have is unfair, compared to about 43% of Gen Z and 30% of Gen X+. This could have something to do with their views on the financial system at large. More than half of millennials and half of Gen Z say they believe the financial system is set up to work against them, compared to just 35% of Gen X+. 

“We are no strangers to debt in America,” said Colleen McCreary, consumer financial advocate at Credit Karma. “However, the concept of hopelessness associated with getting out of debt presented by TV shows, like Squid Game or Hunger Games, is something we don’t talk about as a society, which can make the journey of getting out of debt feel even more isolating and lonely for consumers. The promise of shows like these, however, is that they can spark conversations about larger societal issues, like debt, to slowly start normalizing these topics and give people a forum to discuss them. In fact, our study shows nearly half of respondents say TV shows with money-related themes, like debt and investing, make people more aware of their finances. This was especially true among millennials.”


On behalf of Credit Karma, Qualtrics conducted a nationally representative online survey in October 2021 of 1,016 indebted Americans, aged 18 and above, to gauge how much debt they have, what kinds of debt they have and how they feel about their current debt load.