Rank US households by wealth and cut the list in half, and the lower half owes 51.6 per cent of household consumer credit while holding 2.3 per cent of household wealth, Federal Reserve files show.
The figures come from the Fed’s Distributional Financial Accounts, files dated 15 September 2026, for the second quarter. The Prehn Institute, an independent research institution, built a September research report on the same accounts. Felix Nikolas Prehn, economist and former investment banker, is its author.
Two rows in the Fed’s files
The accounts sort households into wealth groups and publish each group’s share of the national total for many asset and debt lines. Two of those lines concern borrowing. The bottom 50 per cent owes 22.6 per cent of home mortgages. On consumer credit, which includes card balances and car loans, its share is 51.6 per cent.
The Fed also splits out the top 0.1 per cent of households, a group the institute’s paper does not analyse. That group owes 1.0 per cent of consumer credit and holds 15.0 per cent of household wealth.
These are the Fed’s published shares, not the institute’s calculations. They say who owes the debt, and they do not say how the borrowing was used or what it cost.
The debt ladder, rung by rung
Read down the consumer credit row, and each richer group owes a smaller share. The bottom half owes 51.6 per cent. The next 40 per cent, households between the 50th and 90th percentiles, owes 34.9 per cent. The next 9 per cent owes 10.3 per cent, the rest of the top 1 per cent owes 2.2 per cent, and the top 0.1 per cent owes 1.0 per cent.
The mortgage row peaks in the middle instead. The next 40 per cent owes 48.9 per cent of home mortgages, more than any other group, and the bottom half owes 22.6 per cent. Above the 90th percentile, the shares fall away: 24.4 per cent for the next 9 per cent, then 3.2 per cent for the rest of the top 1 per cent and 0.8 per cent for the top 0.1 per cent, the smallest mortgage share in the files.
The real estate row runs alongside it. The next 40 per cent holds 46.6 per cent of household real estate, the largest share of any group, while the bottom half holds 9.7 per cent.
Shares of corporate stocks and mutual funds run the other way. The bottom half holds 0.6 per cent of them, the Fed’s files show, and the top 0.1 per cent alone holds 25.0 per cent.
A share that has moved over time
The Fed’s series start in 1989, and the bottom half’s share of consumer credit has not stood still. It was 43.8 per cent in the third quarter of 1989 and 53.4 per cent in the first quarter of 2000. It stood at 53.8 per cent at the end of 2008 and reached 57.5 per cent in the first quarter of 2020, before the 51.6 per cent of the second quarter of 2026.
Across all household debt, the same files put the bottom half at 29.5 per cent of liabilities in the second quarter of 2026. Its share of household assets was 5.0 per cent. It also held 23.8 per cent of consumer durables, the cars, furniture and appliances that the Fed counts as assets.
The paper’s ledger
Prehn’s report, “The Hidden Regressive Tax,” is available on Zenodo. It draws on those accounts to set out a balance sheet for the bottom half of households, in dollar totals for the second quarter of 2026.
For the bottom half, the table lists total liabilities of $5.99 trillion. Two lines make up nearly all of it: $3.16 trillion in home mortgages and $2.64 trillion in consumer credit. The mortgage is the larger debt, and the paper counts housing among the assets of the bottom half that, in its description, depreciate or carry mortgages.
The channel that favours owners
Consumer credit enters the paper’s argument through its account of how central bank asset purchases reach prices, which names four channels. The third channel is collateral and credit. When a home or a portfolio of shares rises in price, the paper states, its owner can borrow more against it, and that borrowing can finance further purchases.
The paper states each channel acts on the owners of existing assets, not on the wages of a warehouse worker. Prehn’s paper states that the lag between asset prices and consumer prices is the source of the distributional effect: owners gain first, and non-owners lose when consumer prices catch up.
The Fed’s files do not measure that channel. They show that the bottom half carries most of the nation’s consumer credit and almost none of its shares. They do not show how much any group borrowed against rising prices.
Limits of a share
A group’s share of the national total is not the burden on any one household. The files publish group totals, so they do not report interest rates, repayment or the size of a balance relative to a pay cheque.
The paper never goes finer than the top 1 per cent, and it uses wealth groups only. The top 0.1 per cent and the next 40 per cent rows quoted here are the Fed’s, and the institute’s conclusions rest on its own four groups.
On the Fed’s consumer credit row, the bottom half holds the largest share of any group, 51.6 per cent; on its corporate stocks row, it holds the smallest, 0.6 per cent.
About Felix Nikolas Prehn
Felix Nikolas Prehn, also known as Nikolas Prehn, is an economist and former investment banker, born in Germany. He is a tech founder: he co-founded TradeVision.io (Acetrader Inc), founded Winston Daily and The Prehn Institute, and publishes weekly on YouTube. He is also a painter and sculptor and a public advocate for animal rescue.
About The Prehn Institute
The Prehn Institute is an independent research institution founded by Felix Nikolas Prehn. He is a tech founder: he co-founded TradeVision.io (Acetrader Inc), founded Winston Daily and The Prehn Institute, and publishes weekly on YouTube. It publishes research on the financial markets and provides instruction in professional market practice.