NEW ORLEANS - Household debt and investment fear are on the rise nationwide, including in New Orleans. According to Michael Williamson, President of the United Way of Southeast Louisiana, Americans recently hit a staggering financial milestone - but it’s not the kind anyone would want to celebrate. It relates to debt and financial insecurity.
“Household debt has reached an all-time high of $18.04 trillion, with credit card debt alone soaring past $1.21 trillion,” Williamson said. “For many, these numbers are just another headline. But for the thousands of families living paycheck to paycheck in Southeast Louisiana—families we call ALICE (Asset Limited, Income Constrained, Employed)—this isn’t just data. It’s reality.”
Williamson says that for households in this category, debt isn’t about overspending or poor financial choices. “It’s about survival,” he said. “It’s the medical bill that couldn’t wait. The rent that had to be paid. The car repair that was the only way to keep a job.”
Fear about financial security is not limited to those with lower household incomes. According to Jude Boudreaux, Certified Financial Planner (CFP) at The Planning Center in New Orleans, families are more scared now than he’s seen in the last 24 years.
“No one is happy with recent changes relating to finance and the economy,” said Boudreaux. “There’s a lot of fear. It’s tangible.”
Boudreaux says investors fear change and that upheaval to established systems puts them on edge. “The pace of change that the new administration is pushing is causing clients of all political backgrounds to question what is best.”
While wealthier households are worried about their investments, the rising cost of living has made it nearly impossible for many working families to cover basic needs without relying on credit, according to Williamson. But, as credit interest rates climb, the burden of that debt only gets heavier, trapping many families in a cycle that’s hard to escape.
“Debt at this scale is a community issue,” said Williamson. “It affects our workforce, our economy, and the future of our region. If we want Southeast Louisiana to grow and prosper, we must ensure that every person—not just those at the top—has a real chance at financial stability.”
Homeowner’s insurance is another major factor. “Wealthier people are questioning if they should stay here in Louisiana,” said Boudreaux. “I don’t have any hard data about this, but I do have lots of conversations and stories about people who are wondering why they should stay in Louisiana when their insurance costs are rising quickly and they feel they could be more stable financially by moving.”
Homeowners’ insurance premiums rose by 33% from 2020 to 2023 and are even higher now. According to a study by Forbes, Louisiana’s average cost per year for a $350,000 dwelling is $3,604 but according to MoneyGeek, homeowners’ insurance in Louisiana for a $250K dwelling costs an average of $4,552. This is 88% higher than the national average.
Boudreaux said a family he knows saw their monthly expenses rise by only $100 after buying a new home in North Carolina, despite a much higher mortgage interest rate, because their homeowner's insurance in Louisiana had been significantly more expensive.
If wealthier people are feeling the impact of the high cost of homeowner’s insurance, those living with debt and lower incomes are prevented from considering purchasing a home. In states like Louisiana, insurance costs can constitute well over 20% of monthly mortgage expenses. First-time homebuyers are facing higher debt burdens, too, with both income and debt levels increasing significantly compared with previous years.
“At United Way of Southeast Louisiana, we believe financial stability shouldn’t be out of reach for those who work hard every day,” said Williamson. “That’s why we’ve built solutions that don’t just offer temporary relief—but real, lasting change.”
Williamson is referring to United Way’s Prosperity Centers that offer a pathway toward stability. “Our Prosperity Centers provide an array of free programming and resources to help families break the cycle of debt and build brighter futures,” said Williamson. “We have a choice. We can accept this record-breaking debt as the new normal, or we can take action to ensure every household has the opportunity to build a future free from financial hardship.”
