The credit reporting service Experian released its state of credit report today, and some of the news was good. Average credit scores (as Experian measures them) are up from 669 to 673--nearing the pre-Great Recession average of 679. Credit card balances are up, but consumers are still only using less than a third of their available credit, suggesting that the recovery is taking hold. Many creditors are feeling more confident and loosening their purse strings.

But most of us are carrying way too much debt--especially those of us in our 40s, 50s, and 60s. Here are some of Experian's more disturbing findings:

1. Generation X members are in over their heads.

Experian's most disturbing findings concern Generation X, which the company defines as those born between 1967 and 1981. This generation is just up to its ears in debt, with the highest average mortgage balances at $224,836 and the highest average retail card balances at $1,347. They're pretty much tied with Baby Boomers for the highest credit card balances at $6,866, compared to $6,889 for Boomers. The same is true of total non-mortgage debt, which is $42,412 for GenExers, and only slightly higher at $42,628 for Baby Boomers.

There are plenty of logical reasons why 35-to-49-year-olds would have extra debt. Many are still dealing with student loans. At the same time, that age group is likely to be making major purchases such as a home or "grown-up" car. Some are funding their own kids' college educations as well.

But it's worrisome that GenExers appear to be struggling to repay all that debt. Experian found that 40 percent of them had at least one debt that was delinquent by 90 days or more.

2. Baby Boomers won't be ready for retirement.

If you read personal finance advice at all, you'll know that your 50s are the decade when you're supposed to pay down your mortgage, eliminate any other debt, and get financially prepared for retirement. But Experian's research shows that Baby Boomers by and large are not doing any of that, even though all of them are now in their 50s or 60s. They have an average $186,240 in mortgage debt, second highest after GenExers. And with almost $7,000 in average credit card debt and more than $42,000 in debt overall, this generation does not seem to be putting its financial house in order.

For Baby Boomers, the next several years will likely bring lower incomes as they retire or near retirement. A lot of them will be coming up short.

3. Personal debt is way too high.

Both credit card balances and non-mortgage debt overall have been gently creeping upwards this decade, Experian research shows. The numbers suggest we are carrying way too much debt, even leaving aside the question of affording retirement. Consider the average individual income in the United States, which the Census Bureau estimated at $44,510 last year. With Experian's finding of $39,216 of average non-mortgage debt per consumer that suggests a debt-to-income ratio that is way out of proportion to common sense.

Credit utilization may be holding steady because credit card companies and other lenders are quicker to offer more credit than they have been over the past few years. And interest rates at historic lows make larger amounts of debt seem manageable. But as many of us have learned the hard way, just because they offer you credit doesn't mean you should take it.

Taken together, the statistics seem to be telling us that Americans are collectively living beyond our means. That's something we should all carefully consider, because it may not lead us where we want to go.

Published on: Nov 30, 2016
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