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The Richest Americans Are Cutting Debt Before The Fed Hikes Interest Rates
Higher interest rates mean higher debt burdens
The Marriner S. Eccles Federal Reserve building in Washington, D.C.
Photographer: Andrew Harrer/BloombergThis article is for subscribers only.
More wealthy Americans now say they're reducing debt than at any time in the past decade, and the Federal Reserve may be to thank.
About 15 percent of high-income households, those in the top third of the earnings ladder, reported debt declined in September, more than any other time since 2005, according to Friday's consumer-sentiment report from the University of Michigan. The share was only one percentage point lower a 35-year peak reached in April 2000. Those same households reported making further progress on their finances, while the bottom two-thirds of the income distribution said their balance sheets worsened.