165k @ 7.65% means the average American is paying about 12.5k a year in interest alone or 1k per month
Note that 7.65% number is the increase from 2021 to 2022 of overall debt, not APR. Which is still shocking, Americans are rapidly taking on more debt. I guess that is in line with inflation? Even more shocking is credit card debt increased 28.73% year over year!
No idea what the actual average APR for all US debt is, mortgages make up 70% of the total debt so hopefully it's far less than 7.65% APR
The thing about all this additional debt is that it's not uniformly distributed across the population. Suppose there's a national personal debt increase of USD$332M over some time period. With the US population of roughly 332 million, that's an additional USD$1 for every man, woman, and child. That's really no big deal, *if* the debt is distributed uniformly. But we all know it's not. The debt is concentrated in mortgages, student loans, vehicle loans, credit cards, and-- for some-- medical debt. But there are families that don't carry debt at all, whose homes are paid for, who pay cash for everything. Not all of them live high on the hog, but there are people who aren't in debt and who aren't taking on any more. There are also people who make use of leverage for investment purposes to generate cash flow that is net positive. But there are far more people who are basically debt-slaves.
In a truly free market economy, when the cost to exchange decreases money and resources distribute in more of a Zipf fashion than a standard-normal bell curve. That may be mathematically optimal, but it's not socially optimal because starving people eventually revolt and take what they need. In the US the majority of the financial and legal system happens to benefit investors as opposed to workers, lenders as opposed to borrowers, and financially independent people as opposed to debt slaves. Trouble is, this economy *does* require at least some debt-slavery for us to get our grease. This is part of the reason why the myth of "good debt" has survived as long as it has, and why people are willing to borrow six figures for an advanced degree in underwater basket weaving without having independent means and without any possibility of leveraging that degree to find work that will pay for the debt acquired to obtain it.
Student loan debt tends to be heavier in three clusters of people. The first group is the people who have borrowed big for extremely lucrative degrees (medicine comes to mind), who do in fact obtain those degrees, and who can pay them off without what any of us would consider serious financial stress. Nobody needs to worry about them because they have the situation under control. The same can be said of most graduates of a journeyman program or community college. The amount of debt they graduate with is manageable given their earning potential.
The second group of student loan debtors is the group of people who borrow heavily proportionately to their earning potential. Private colleges and trade schools charge tens of thousands of dollars more than equivalent public schools, and they market aggressively to women and minorities from disadvantaged backgrounds, who either didn't take the usual aptitude tests or who didn't graduate from high school and obtained an online degree or a GED. In exchange for waiving the usual entrance requirements such as the remedial math, English, and other training necessary to ensure their academic readiness, the student obtains a very structured experience which, if they pass and complete the degree, will produce a marketable credential. But the debt to earning ratio is quite low for these graduates, who will struggle to live independently even if they obtain employment. They do best when they cooperate with, and are significantly supported by, somebody else. Luckily most of them come from the kind of background where relying on other people is a reasonable thing to do. Their children tend to be raised with more opportunity. But unfortunately this group of people tends to have the kind of short-term gratification mentality that makes them good debt slaves. They tend to have vices such as tobacco, alcohol, and compulsive shopping. It's the same value system that kept them from finishing high school and taking a more professional-class route through education.
The final group of student loan debtors, which I fear is where most of the debt may be concentrated, is the people who don't end up with a credential that will generate enough income to pay off the debt while providing a non-starvation standard of living. This includes people who drop out and never graduate, people who graduate with a credential that doesn't generate the income necessary for it to pay for itself, and people who graduate with a credential for which the market is over-saturated to the point where they can't obtain employment in their field or market their skills well enough as entrepreneurs. These people tend to burn out. They tend to lack support systems and to end up in a never-ending grind where they struggle so constantly to keep up. They are the most vulnerable to conspicuous consumption culture, and they are more likely to have untreated mental health problems or addictions.
In our financial system, people volunteer to be debt slaves. Conspicuous consumption is trendy and large numbers of people subscribe to the "treat yo'self" mentality of emphasizing short-term thrills at the expense of long-term financial stability or even of paying their bills. It's trendy and cool to be evicted for not paying rent, or to apply for food stamps because there's no money for food after the professional armpit-waxing and gargantuan cell phone bills have been paid. Debt slaves aren't afraid to rack up debt because they truly believe that if things get bad enough and they bibble-babble hard enough, someone will swoop down in a golden chariot, rescue them from the predictable consequences of their own actions, wipe their butts, and set them free to go out and repeat the exact same mistakes. This belief invariably has some basis in fact.
I don't think that we have the wherewithal to dethrone conspicuous consumption, but Mustachians do have the ability to spread the word that THERE WILL BE NO RESCUE.