New Year Brings Hope to Consumers Regarding Their Debt

The Consumer Debt Stress Index (DSI) dropped by slightly more than 2 percent in January, from 119.8 to 117.4

“We’re seeing increased confidence among consumers that they will be able to stay on top of their debts and ride out the economic storm,” said Lucia Dunn, professor of economics at Ohio State University and one of the leaders of the DSI.

“It’s a good start for the new year.”

The DSI is conducted by Ohio State’s Center for Human Resource Research and is based on telephone interviews of randomly selected Americans. Each month’s index score is based on the past three months of interviews, with the average sample size being 673.

The DSI has been conducted monthly since January 2006, where its base value was set at 100.

The outlook is much rosier than this time last year, when the DSI was on the rise, peaking at an all-time high of 155.3 in July.

The July figure meant that consumers were experiencing stress levels from their debts that were more than 50 percent higher than they had been in January 2006, when the index had a value of 100.

In general, the index has been on the decline since then.

Findings showed that stress levels are declining faster for men than they are for women. The DSI dropped 3.6 points for men in January, compared to only 2.5 points for women.

The survey also examines how debt stress is affecting consumers’ family life, job performance and health. In general, the negative effects that debt stress has on family life and job performance have stabilized or shown small improvements in the past several months.

However, the negative impact of debt on health is still somewhat higher than it was a year ago, results showed.

Slightly more than 23 percent of respondents said their health was somewhat, quite or very much affected by their debt. One year ago, 20.6 percent answered that way.

“The affect that debt stress has on health continues to be troubling,” Dunn said.

Contact: Lucia Dunn, (614) 292-8071; Dunn.4@osu.edu
Written by Jeff Grabmeier, (614) 292-8457; Grabmeier.1@osu.edu