An early warning sign of bill-paying problems is flashing for California and the nation.

To check Californians’ financial health, my trusty spreadsheet examined consumer debt statistics compiled by the New York Fed. These numbers for 2024’s final three months provide a window into the bill-paying habits of roughly 90% of the population with credit histories.

Ponder a metric that tracks debts moving into 30-days-or-more-late status. Basically, we’re talking about the first skipped payment.

As 2024 ended, 3.25% of California borrowings fell into this worrisome bucket — the highest level since 2016’s first quarter. Yes, almost nine years ago, when the economy’s rebound from the Great Recession was kicking into high gear.

Nationally, skipped payments are even higher: 4.14% of debts entered the earliest of tardy status in the fourth quarter. It’s the biggest boost since the first quarter of 2020, just before the coronavirus upended the business climate.

Now, for context, this level of skipped bills is below the pace of 2003-2005, boom times just after the turn of the century.

And 2024 is nowhere near the wave of early missed payments during the Great Recession. In 2009-10, these late payments averaged 14.4% of debts in California and 10.8% nationally.

Still, today’s growing bill-paying pressures help explain rising consumer angst, anxieties that are otherwise contradicted by economic yardsticks that suggest a robust economy.

Bigger picture

It’s one thing to miss one payment. It’s another when those late bills run even tardier.

Ponder debts that are 90 days or more late. Across California, that was 1.6% of debt in the fourth quarter, up from 1.2% at year-end 2023 and the highest since the first quarter of 2021.

Yet this tardiness is still solid repayment, historically speaking. In the pre-pandemic period of 2018-19, the average bill was 1.9% tardy. And we’ll note the 11.6% average of 2009-10.

Californians have been better at this level of bill paying than most Americans, too.

Nationally, 1.9% of debts were tardy in the fourth quarter, up from 1.7% a year earlier. Like California, this is low: 3.1% of bills were late in 2018-19 and 7.9% in 2009-10.

Big borrowers

Californians carry lots of debt, mainly due to lofty home prices and mortgages.At year-end 2024, outstanding consumer borrowings statewide totaled $86,130 per capita, with 79% of those debts tied to first mortgages.

The nation’s $60,630 of debt per capita is almost one-third less than California. And the typical American has 69% of their borrowings linked to a mortgage.

But consumers have cooled their willingness to borrow recently, a sign of skittish shoppers.

California’s debts grew 1.4% in the past year after expanding just 0.1% in 2023. Compare that with debts jumping by 8% in 2022 or growing at a 2.7% average annual pace in 2018-19.

And U.S. borrowings are shrinking, falling at an 0.7% annual rate in the fourth quarter. That’s a switch from 1.9% growth for 2023, 7.3% in 2022, and 3% in 2018-19.

Home sweet home

Whatever the payment challenges, they are not mortgages.

As of year-end 2024, California mortgages that went unpaid for 90 days or more accounted for only 0.6% of all loans. Yes, that’s up from 0.4% a year earlier and 0.5% in 2018-19.

So, 2024 was relatively typical for late bills. Remember, 11.9% of California home loans in 2009-10 went unpaid for 90 days or more.

Ponder similar trends nationally: 0.6% of U.S. mortgages are 90 days late — equal to a year ago and below 1% of 2018-19. This metric hit 8.1% in 2009-10.

Bottom line

Pick your reason for more skipped payments: Stubborn inflation. High interest rates. Sluggish job markets. Or the evaporation of stimulus-fueled savings.

Regardless of the cause, it seems balancing a typical household budget was challenging as 2024 ended. While it was not historically significant, it was noticeably more difficult.

Consider a consumer’s worst-case scenario: bankruptcy. New filings remain rare, though they are are modestly more common. (Note: Some legal challenges have made bankruptcy an even less-appealing option.)

California’s new bankruptcies increased to 35 per 1,000 consumers in the fourth quarter, up from 32 at year-end 2023. However, this pace is less frequent than the 56 per 1,000 in 2018-19 and 266 in 2009-10.

This mimics national trends: At year-end 2024, there were 42 new U.S. bankruptcies per 1,000 consumers, up from 40 a year earlier. This metric averaged 76 in 2018-19 and 211 in 2009-10.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com