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For Most Americans, Financial Success Now Means Being Debt-Free
By Adam Hardy MONEY RESEARCH COLLECTIVE
The new hallmark of financial success? Cutting bad debt and reclaiming control.
For a large majority of Americans, being financially successful means being debt-free.
About 3 in 4 U.S. adults (74%) now say being debt-free is a key part of how they define financial success, according to KeyBank’s Annual Financial Mobility Survey released last week. The bank’s survey found that Americans are prioritizing being debt-free over other traditional life milestones such as getting married or buying a home.
“The financial landscape for Americans is shifting in profound ways,” Daniel Brown, an executive vice president at KeyBank, said in a statement. “It’s showing that the measure of success is not wealth alone, but also the ability to live debt-free and prepare for what’s ahead.”
KeyBank surveyed over 1,000 U.S. adults aged 18 to 70 in July for the bank’s seventh annual report. In 2025, Americans say they are feeling far more financially stressed than they were last year, with 68% reporting financial stress versus 50% in 2024.
Americans’ feelings of financial success are also diminishing, KeyBanks says. Only 39% of adults say they’re feeling more financially successful than they did five years ago. The rising cost of living is largely to blame, with respondents particularly struggling with food and housing costs, as well as credit card debt.
Since the start of 2020, the cost of living has ballooned by about 26%, according to data from the Department of Labor. Both grocery and housing costs have risen by approximately 30% since then.
Meanwhile, the Federal Reserve Bank of New York says American household debt has risen to $18.6 trillion, of which $1.2 trillion is credit card debt.
How to become (bad) debt-free
While some Americans dream of the days of having zero debts, it’s important to remember that not all debt is created equal. Some debt may even be “good debt.”
Adrianna Adams, a certified financial planner at Domain Money, previously told Money that good debt includes liabilities that increase your net worth, significantly enhance your life and/or provide future value. A mortgage, for example, is a major debt, but it’s a good one that often increases in value and provides a roof over your head.
Having at least some debt is required to build credit, so that you can qualify for a mortgage in the first place.
Still, Americans are right to be wary of racking up debt, especially debts like payday loans or credit card balances.
Eliminating debt — especially bad debt — takes proper planning. First, you should list out who you owe, your monthly payments, total balances and annual percentage rates (APRs). The Consumer Financial Protection Bureau has a helpful debt-log worksheet you can use as a template.
For starters, you’ll want to make sure you’re covering the minimum monthly payments on all of these debts. Then you’ll want to decide between the two most popular debt pay-off strategies: the debt snowball or the debt avalanche.
The debt snowball method prioritizes debts with the lowest balance, while the debt avalanche targets the debt with the highest APR first.
In some cases, debt consolidation may be a savvy move to simplify your debts into one monthly payment. For example, it may be possible to get a lower interest rate on one debt consolidation loan than what you’d be paying across several credit cards.
Alternatively, you could extend the length of the loan to pay less each month (but more in total) if you’re struggling to afford minimum payments.
Whichever method you choose, you’ll want to adjust your budget accordingly to accommodate making extra debt payments in a manner that keeps you motivated and on track to reach your goals — whether that’s being entirely free of debt, or just getting rid of the bad kind.
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Adam Hardy is Money's lead data journalist. He writes news and feature stories aimed at helping everyday people manage their finances. He joined Money full-time in 2021 but has covered personal finance and economic topics since 2018. Previously, he worked for Forbes Advisor, The Penny Hoarder and Creative Loafing. In addition to those outlets, Adam’s work has been featured in a variety of local, national and international publications, including the Asia Times, Business Insider, Las Vegas Review-Journal, Yahoo! Finance, Nasdaq and several others. Adam graduated with a bachelor’s degree from the University of South Florida, where he studied magazine journalism and sociology. As a first-generation college graduate from a low-income, single-parent household, Adam understands firsthand the financial barriers that plague low-income Americans. His reporting aims to illuminate these issues. Since joining Money, Adam has already written over 300 articles, including a cover story on financial surveillance, a profile of Director Rohit Chopra of the Consumer Financial Protection Bureau and an investigation into flexible spending accounts, which found that workers forfeit billions of dollars annually through the workplace plans. He has also led data analysis on some of Money’s marquee rankings, including Best Places to Live, Best Places to Travel and Best Hospitals. He regularly contributes data reporting for Best Colleges, Best Banks and other lists as well. Adam also holds a multimedia storytelling certificate from Poynter’s News University and a data journalism certificate from the Investigative Reporters and Editors (IRE) at the University of Missouri. In 2017, he received an English teaching certification from the University of Cambridge, which he utilized during his time in Seoul, South Korea. There, he taught students of all ages, from 5 to 65, and worked with North Korean refugees who were resettling in the area. Now, Adam lives in Saint Petersburg, Florida, with his pup Bambi. He is a card-carrying shuffleboard club member.