Concerns About Missing Minimum Debt Payments Grow to Their Highest Level in Nearly Five Years

The first few months of 2025 have ushered in economic instability in the U.S. as concerns over trade policies have led the S&P 500 to undergo its first correction in more than one year. But economic uncertainties aren’t just roiling equity markets. They’re also causing more Americans to downgrade their outlook for their personal finances.

Americans’ average perceived probability of missing a minimum debt payment within the next three months increased in February to 14.6% — the highest level since April 2020, according to a Federal Reserve Bank of New York survey. The increase was driven by survey respondents who don’t have a college degree, per the Federal Reserve Bank of New York.

Many factors can cause people to have a pessimistic outlook about their financial future. In addition to their negative expectations regarding the stock market, Americans taking part in February’s Survey of Consumer Expectations said they anticipate inflationary pressures will rise over the coming year, according to the Federal Reserve study.

Specifically, households expect the price for staple expenses — including food, gas, and medical care — to rise over the next 12 months.

“Households expressed more pessimism about their year-ahead financial situations in February, while unemployment, delinquency, and credit access expectations deteriorated notably,” the Federal Reserve Bank of New York wrote in a press release.

Those looking for a beacon of hope may find one in survey respondents’ assessment of the U.S. labor market. Respondents indicated they expect the U.S. unemployment rate to be higher in one year’s time than it is today, but fewer of them believe job losses will impact their employment status than did respondents in the previous version of the survey. 

Only 14.1% of survey respondents said they expect to lose their jobs over the next 12 months. And 17.6% of respondents — the lowest percentage since July 2023 — report that they plan to leave their jobs within the next year.

Multiple factors have emerged during 2025’s first quarter that can cause economic turmoil for many consumers. Stock market downturns have eroded wealth. And Americans are encountering sticker shock nearly everywhere they transact.

More than two-thirds of respondents to a recent Pew Research Center study say the affordability of healthcare is a “very big problem” in the U.S. today. But the prices of everyday items have also soared in 2025.

While the cost of a dozen eggs has gone up nearly 280% in 2025 compared to the 2019 prices, prices of other common foods have also skyrocketed over the same period. Frozen orange juice and sugar both cost significantly more today than they did just six years ago.

Without enough funds in their checking or savings account to purchase items, more people may turn to credit products to complete transactions. But consumers report credit access as another sour spot in their economic lives. The Federal Reserve Bank of New York survey reveals that “perceptions of credit access compared to a year ago showed a larger share of households reporting it harder to get credit, and a smaller share reporting it easier.”

Companies that issue credit cards and loans examine an applicant’s creditworthiness before determining whether to extend them credit. Lenders assess a borrower’s creditworthiness — which also influences how much credit a lender offers to a borrower — through a variety of factors, including borrower payment history and the amount a borrower owes creditors.

People who want to improve their creditworthiness — but aren’t confident in their ability to accomplish that on their own — may seek the guidance of credit counseling agencies to help them improve their credit profile.

Consumers who are facing bleak economic conditions and smaller opportunities to access suitable credit products may feel like the walls are closing in on their financial lives.

Credit counseling agencies that are poised to steer consumers toward healthy financial waters can prosper in periods where large swaths of the country are experiencing financial uncertainty.

We caught up with Howard Dvorkin, Founder and Chairman of Debt.com, to gauge how credit counselors can help consumers prepare for the future in 2025.

“If there’s any silver lining to this economic rollercoaster ride, it’s the renewed focus on credit counseling services,” Dvorkin told us. “When the economy is roaring, these amazing services tend to get ignored. Now Americans are rediscovering their value.”

Dvorkin told us trained counselors can recommend long-proven strategies — including debt management programs, debt settlement plans, and even bankruptcy — to help consumers escape debt. Many credit counselors accommodate customer meeting preferences — including offering to meet remotely. 

Established credit counseling companies with strong reputations may attract more customers than those that are just starting out. Dvorkin told us he advises consumers to “find a reputable company. Make sure they have an A rating from the Better Business Bureau and excellent online reviews.”

Dvorkin told us he believes credit counselors should offer consumers a free debt analysis, regardless of whether they work for a nonprofit credit counseling agency or a for-profit group.

“That’s important, because you can’t get out of personal debt if you don’t personally understand how you got there,” Dvorkin said.