Debt held by those younger than 50 years old as a share of all US consumer borrowing increased by the most on record in the third quarter, according to Federal Reserve figures out Tuesday.

Consumers under the age of 50 now hold 55% of all US household debt outstanding compared with almost 48% in the second quarter. The massive 7-plus percentage points surge is unprecedented in New York Fed bank data going back to 1999.

Total US household debt grew by $228 billion last quarter to reach $17.3 trillion. The increase was completely driven by consumers younger than 50, whose debt rose $1.4 trillion. Borrowing by older Americans was little changed.

The change was largely driven by mortgage, credit card, and student loan balances. Before the pandemic, debt outstanding was roughly equal among younger and older households. Since then, younger consumers added close to $3 trillion in debt while the older Americans added $1.3 trillion. In light of rising interest rates, carrying higher debt loads underscores the financial challenge for consumers under 50.

The most indebted households are those between the ages of 40 and 50, while those in their 30s and those in their 50s hold roughly equal amounts of debt. One key difference is that households below age 50 hold $1.2 trillion in student loan debt, compared to about $400 billion for those who are older.

Auto loan balances rose by $13 billion last quarter, to a record $1.6 trillion. Since 2019, US consumers have added $264 billion in auto loans to their overall debt levels. During the same time, the average interest rate on a four-year auto loan has risen from about 5.5% to 8.3% according to Fed data.

Over the past four quarters, younger households have originated $436 billion in new auto loans compared with $261 billion for those over age 50.

Serious delinquencies for auto loans, or loans 90 days or longer past due, are at the highest level since the Great Recession for borrowers in their 20s and 30s.

Credit-card balances increased by 4.7% last quarter, or by $48 billion, to an overall level of $1.08 trillion. At the same time, credit-card delinquencies have risen — particularly among younger consumers.

Overall, 5.8% of credit-card users had unpaid debt that transitioned into serious delinquency status. A year ago, 3.7% of payments were 90 days or more past due.

To help those with student loans return to repayment, the Education Department created a temporary on-ramp period through Sept. 30, 2024. This prevents any loan delinquency from being reported to credit agencies for the next year, which may make the true consumer loan repayment status more opaque.

This article was provided by Bloombeg News.