Financial counseling reaches highest level since 2017; Gen Z clients surge 35%
The financial strain on American households continues to intensify as rising inflation and persistently high credit card interest rates push more consumers toward debt consolidation programs.
According to Money Management International (MMI), one of the nation’s largest nonprofit credit counseling agencies, nearly 15,000 consumers enrolled in its debt management plans during the first six months of 2026. It marks the highest first-half total since the organization began tracking the data in 2017.
Debt consolidation generally combines multiple credit card balances and other unsecured debts into a single monthly payment. Credit counselors negotiate with creditors to lower interest rates, allowing consumers to pay off their debt more efficiently. While the approach can simplify repayment, participants typically must close their credit card accounts, and the required monthly payments can still be substantial.
Although the figures represent a single organization, MMI also conducted more than 40,000 financial counseling sessions during the first half of the year. Counseling activity has increased for five consecutive years and is up 143% compared with 2021.
The trend reflects growing financial stress across the U.S. economy. According to the Federal Reserve Bank of New York, total household debt has climbed to a record $18.8 trillion. Meanwhile, Experian reported that the share of Americans with personal loans increased from 31% in 2017 to 38% in 2025.
At the same time, personal bankruptcies and debt collection lawsuits have been rising, while the U.S. personal saving rate has fallen to 2.7%, its lowest level since the inflation crisis of 2022.
Financial experts point to inflation as the primary driver behind consumers’ growing debt burdens. Based on the Consumer Price Index, consumer prices have risen by approximately 27% since the beginning of 2021.
“In a word, I would attribute a lot of this to inflation,” said Ted Rossman, principal consumer finance analyst at MMI. “The post-pandemic surge in prices for just about everything has put tremendous pressure on household budgets.”
One consumer who benefited from debt management is Miriam Perez, a real estate agent from Syracuse, New York. After her business slowed during the COVID-19 pandemic, she accumulated more than $100,000 in credit card debt. She enrolled in a debt management program and paid off the entire balance in about three and a half years. Today, her business has recovered, and she recently purchased a new vehicle.
“It just felt like I exhaled for the first time in a while,” Perez said of joining the program.
The report also highlighted growing financial pressure among younger Americans.
MMI said the number of Generation Z clients (ages 18 to 29) increased 35% over the past year, making them the fastest-growing group seeking debt management assistance. Millennials (ages 30 to 45), who account for 56% of MMI’s clients, carry an average unsecured debt balance of $43,533, while Generation X (ages 46 to 61) has the highest average unsecured debt at $53,350.
Credit card delinquencies are also worsening. The New York Fed reported that approximately 13% of U.S. credit card balances were at least 90 days delinquent during the first quarter of 2026, the highest level since 2011 in the aftermath of the global financial crisis.
Financial experts say consumers with relatively small balances and good credit may benefit from using 0% APR balance transfer credit cards. However, those carrying large debt loads or struggling to make payments should consider seeking assistance from nonprofit credit counseling agencies before their financial situation deteriorates further.
