DISCLAIMER: As the COVID-19 public health situation evolves, new regulations are being continually issued. This page/story/information may not include the most recent information.The Fed’s latest Survey of Consumer Finances might come with a caveat: The data measure a period that may seem long ago and far away — the time before COVID, of course. But they show an increasing interest in online banking, an attempt to grow savings — and a higher debt burden.

At a high level, noted the Federal Reserve, between 2016 and 2019, real gross domestic product grew at an annual 2.5 percent rate, while the overall (civilian) unemployment rate slipped from 5 percent to 3 percent. Median family income was up about 5 percent in the three years through 2019, to about $58,600.

“The improvements in economic activity along with rising house and corporate equity prices combined to support continued increases in median and mean family net worth (wealth) between 2016 and 2019,” the Fed noted. Housing certainly contributed to a wealth boost, up more than 5 percent annually, while equity markets increased by double-digit percentages from 2016 to 2019.

Between 2016 and 2019, the proportion of all families that saved increased from 55 percent to 59 percent. Transaction accounts — which the Federal Reserve reported include checking, savings, money market, call accounts, and prepaid debit cards — remained the most commonly held type of financial asset in 2019. That ownership rate was more than 98 percent, growing from 2016 to 2019 to a median value that was up 11 percent to $5,300.

At least some of the improvements in financial position may also have come through private business ownership. The Fed noted that, overall, about 13 percent of families surveyed owned a business.

“Business ownership increases with income, and nearly 40 percent of families in the top decile of the income distribution owned a business,” reported the Fed.

Owning at least some type of financial asset was commonplace over the measured period. Overall, 98.7 percent of families in 2019 owned at least one financial asset — which includes transaction accounts, certificates of deposit, savings bonds, other bonds, stocks and other holdings.

Online Banking  

The Fed also delved into whether use of online banking during 2016 to 2019 had reduced use of banking services in a physical setting.

“Even families that used online banking continued to use at least some physical financial services, such as visiting local bank branches,” the Fed found.

Even among families that used online banking, 79 percent visited their checking account branch, and 67 percent visited their savings account branch in 2019.

Debt Burden 

The data show that the debt burden increased over this timeframe, after having declined from 2010 to 2016 and as measured as various ratios — leverage, debt to income and payment to income. “Most of these ratios increased slightly between 2016 and 2019, implying families faced somewhat higher debt burdens … However, these ratios remain below their levels just before the 2007–08 financial crisis. In 2019, the median leverage ratio for debtors was slightly below its 2007 level at 33.9 percent; median debt-to-income and payment-to-income ratios for debtors in 2019 — at 95.7 percent and 15.3 percent, respectively — were well below 2007 levels,” the Federal Reserve stated.

As far as debt service was concerned, the Fed reported that in 2019, 12.3 percent of families surveyed reported being late on payments, down from 13.5 percent in 2016 and leagues below the 20.8 percent in 2007.

PYMNTS research has revealed that more than 59 percent of consumers live paycheck to paycheck and almost have less than $2,500 in savings.

“The percentage of families that reported being 60 days late or more declined from 5.8 percent in 2016 to 4.6 percent in 2019, substantially below the recent peak of 8.1 percent in 2010,” according to the Fed.