American credit card debt reached about $1.21 trillion in 2025, well above the roughly $900 billion it hit around 2008. Prices keep rising faster than paychecks, so people keep spending at the same level and cover the gap with credit cards and home equity lines. In Episode 009, Nicky P, Luke Tatum and Rob Brayton look at the numbers, what they say about how the system is built, and what opting out looks like in practice.
“You either have to stop buying the things you wanna buy or you gotta make more money, or ideally both of those things, right?”
Nicky P opens with the Fed's latest numbers: Americans are apparently on holiday at the beach and swimming in debt. Luke pulls up the Federal Reserve Bank of New York chart, and the line is close to vertical. The question for this episode is why people keep spending when everything costs more, and what you can do about it in your own house.
What We Covered
The numbers. Credit card debt was just under $900 billion around 2008. Now it's $1.209 trillion, and total consumer debt is over $18 trillion. The savings rate Rob pulls from the St. Louis Fed is 4.4%. Luke adds that 46% of cardholders carried a balance at least once in the past year, on cards charging around 27%.
Parkinson's law, at the grocery store. Rob says spending rises to meet whatever comes in, and now it's going past that into home equity lines and credit cards. Luke's version: you buy the same groceries every week, the price keeps going up, and a 2% raise doesn't keep pace. You have to buy less, earn more, or ideally both.
Housing and a Texas client story. Nicky asks how much of take-home pay housing eats now compared to 2008. Luke shares a client story from Texas, which has no income tax but does have property tax. As values rise, the assessor raises the bill. One client sold her home to get rid of the mortgage and downsized. Not everyone can do that without moving hundreds of miles.
“You’re a bad money maker if you don’t owe them money.”
Boomers, millennials and the rules of the game. Nicky describes the squeeze: boomers want to downsize, millennials can't afford the big houses, and large buyers pick up properties to rent out. He says it's a game the house always wins as long as you play by its rules, which is what first drew him to the Infinite Banking Concept.
Take responsibility. Rob says the first step is education, then action at the you-and-me level. Luke says Perfect Spiral Capital uses a five-step approach, and step one is taking responsibility. Banks don't care that you need a house or groceries. They lend when it's a good deal for them.
What your credit score really measures. Rob says a high score tells the bank you're a good money maker for them. Nicky puts it more precisely: it rates how likely you are to pay them back. Pay everything off and the score can drop. Luke traces the debt-based system back to 1913 and the meeting on Jekyll Island.
“We went from about 8% to 35% in the space of two and a half years.”
Leverage and who owns the debt. Nicky notes that even the cash flow community still builds everything on debt. Luke says a Robert Kiyosaki-style playbook works differently for someone with assets in many states than for someone starting with $10,000 a year. Rob says leverage itself is fine. The question is who owns the debt, because they control your cash flow. He also points to Federal Reserve Bank of New York data showing 90-day delinquency rates rising since 2022.
By design. Rob believes much of this is built in: the system pulls wealth from the average person into the banking system. Real change would mean shrinking the money supply and letting prices fall, which would hurt. The people who are properly capitalized are the ones who come through it.
Opting out. Luke still has a checking and a savings account. But he keeps his wealth somewhere else, in properly designed whole life insurance with mutual companies, some of which have paid dividends for more than 100 years. When he wants to use that money, he doesn't ask a bank. The policy contract requires the insurer to lend against his cash value. Rob shares his own result: his family's savings rate went from about 8% to 35% in two and a half years.
Key Takeaway
You can't fix the national debt chart, but you can fix your own savings rate. Take responsibility, learn how the game works, and start building savings in a system you own and control. As Luke says, it's not for rich people, and finding that out for yourself is better than assuming it.
Key Moments
[0:00] The Credit Card Numbers
[1:00] Parkinson's Law
[4:00] A Texas Client Story
[6:00] Boomers, Millennials and Playing by Your Own Rules
[9:00] Step One: Take Responsibility
[10:00] What Your Credit Score Really Measures
[13:00] Leverage Rules Aren't the Same for Everyone
[15:00] Who Owns the Debt? Delinquencies Rising
[18:00] By Design
[20:00] Opting Out
“The whole point is that it’s not for rich people.”
Related Episodes
Episode 003: Global Inflation Falls Everywhere But America: When Money Becomes Worthless
Episode 008: What Does a Fed Rate Cut Mean for You? Easy Money and Who Benefits First
Episode 046: Kroger Loses $12 Billion: What Low-Income Shoppers Fleeing to Amazon and Walmart Reveal About the Real Economy
Want the full conversation, including Luke's Texas client story? Listen to the full episode and grab the free toolkit at PerfectSpiralCapital.com/podcast.
FAQ
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About $1.21 trillion in 2025, according to Federal Reserve Bank of New York data, compared with just under $900 billion around 2008. Total household debt is over $18 trillion.
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Prices have risen faster than many paychecks, and most people haven't cut spending to match, so cards and home equity lines cover the gap. With the personal savings rate around 4.4%, there isn't much cushion. In Episode 009, the hosts note that 46% of cardholders carried a balance at least once in the past year, at rates near 27%.
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It can. A credit score rates how likely you are to repay borrowed money, so it rewards an ongoing record of borrowing and paying back. Paying everything off and closing accounts can lower it. As Nicky P puts it, you're a bad money maker if you don't owe them money.
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It doesn't mean giving up a bank account. Luke Tatum still has checking and savings. It means building your savings outside the public banking system, in properly designed whole life insurance, where the policy contract gives you the right to borrow against your cash value on your own repayment schedule. Many mutual insurers have paid dividends for more than a century, though dividends aren't guaranteed.
Show full transcript
Between The Lies: Episode 009 Transcript
Swimming in Debt [0:00]
Nicky P: According to the Fed, Americans are apparently on holiday out to the beach and just swimming in debt. Welcome to the Between The Lies Podcast, your weekly lesson on how to approach an uncertain world with positivity and balance. I'm Nicky P here with my good friends and money brains. Luke Tatum and Rob Brayton from Perfect Spiral Capital.
Stick around to the end of the video for their free toolkit and be sure to like and subscribe if you enjoy the video. Gentlemen, got your towels?
The Credit Card Numbers [0:00]
Rob Brayton: Yeah, I think so. We have, it's kind of crazy to take a look at some of these numbers and quite frankly, they're really unbelievable. You know, we look if just taking a quick look, $439 billion in a quarter is what the credit card debt increased.
For reference, that's half of what all the credit card debt was in 2008. And, you know, that ended great. Right. So I don't know what you think, Luke.
Luke Tatum: Yeah. That's one way to put it. Yeah, I mean, so right to your point, I mean, I'm looking at the chart too. It was just under $900 billion of total credit card debt back in oh eight.
And of course it started to, Spike as the recession happened there, but, and then tapered off or whatnot. But we've been way above those levels for a while now. I mean, we're, gosh, what is it? We are now at $1.209 trillion in consumer credit card debt in the United States. And that is big number.
So what do people do about that?
Parkinson's Law [1:00]
Rob Brayton: What it says to me is clearly prices have been on the rise, right? We've seen this big increase in inflation. It ties into a lot of what we've talked about before, and what it tells me is we haven't overcome Parkinson's law. You know, people are continuing to spend at their same levels and it's just showing up in their home equity lines.
It's showing up in their credit cards. We can see that across all these different, you know, debt statistics. So. I would say that seems to be what's really taking place is we haven't reined in spending to become a little bit more conservative despite the fact of how expensive things are getting.
Sure.
Same Groceries, Higher Prices [2:00]
Luke Tatum: So if you, another way of saying that is if you go to the grocery store, you buy exactly the same set of groceries every week or every two weeks or whatever you do, but the price of those things keeps going up. And you don't make any more money, or you get a 2% raise, you know, the inflation fighting annual increase on your salary or whatever, then you're fighting a losing battle right there.
You have to make drastic changes. You either have to stop buying the things you wanna buy or you gotta make more money, or ideally both of those things, right? And so. But we're not doing that as a, as a society, you know, here in the United States. Like it is a very, very vertical line when you're looking at this chart over time.
Maybe we can even edit that into the episode or something and show it after the fact. It's like, it's not pretty to look at. So is this just then the average person is not, you know, facing reality, or is this. The tariffs or, I mean, what do you do? Is it everything? Is it one thing?
Housing and Take-Home Pay [3:00]
Nicky P: Well, let, so let me pose the question because, you know, we all, we all could probably practice a little bit more austerity in our lives, but you know, it's difficult.
Well, here's a good question. What is the percentage of the modern Americans, Take home wages that how like home ownership housing takes up now versus 2008. So it's like. There's only so much downsizing you can do, like to make things work. You eventually, like the, there's a bottom to the market.
Like there's a, they only let home values get so low because that's where so many people have their value locked in. It's, we've mentioned this before on the show and. Maybe it's the old lefty in me that, you know, wants, it's like, well, hey man, like we got a, we got a screwed up game here. Where no matter how hard we fight the, yeah, sure the value of a house goes up, but like, I can't save enough to do that because I can't make enough money to buy a more expensive house.
You know? Or Yeah. It's great that the stock market keeps going up, and all that means is everything's more expensive. It's over and over again. We keep getting pummeled with, everything's more expensive, but nobody's paying more. They're still dealing with all the same crap. So, you know, is it's, is it just a system designed to shit on the little guy?
A Texas Client Story [4:00]
Luke Tatum: You know, I have a client story and I'll just kinda add to that. And so, of course, not naming any names or getting specifics right. But, I have a lot of people that I know in Texas, that's where we grew up and everything, my wife and I, and so. A lot of connections in Texas, and Texas has no income tax, but they have property tax, right?
And so what happens when inflation goes up? Well, everybody also thinks that they're getting richer at the same time because their property values are going up, right? The level of prices across the board are kind of floating upwards, and that applies to your property. And so you go, oh, wow. My house is worth a lot of money.
Well, what happens when that happens? Well, the tax assessors wanna get in there and reassess your property so they can raise your property taxes, right? And so people's mortgage payments are going up. You could afford it whenever you get that. But if your paycheck is buying less at the grocery store and your mortgage payment is going up and your property gets reassessed, all these things, all these things happen to everybody all at the same time.
And so I have someone who sold her house. To get rid of the mortgage and downsize into a smaller property. She was able to do that, you know, great, great that she was able to do that. Getting rid of that mortgage is a huge boon, but as you say, I mean, if you don't wanna move hundreds and hundreds of miles to a different state with like a lower income or a different set of tax rules or something like that, you may not have that option.
You may not be able to move that far. And so. That just puts people in a pickle. One way of putting it,
Boomers, Millennials and Playing by Your Own Rules [6:00]
Nicky P: One of the things across the internet right now is the joke about boomers. And like the cliff that they're all headed towards where their houses are all worth so much, but there's nobody to buy their houses when they're ready to downsize.
Like, you know, they're hitting that age where they don't want to deal with a big house. You just want the little place, but there's nobody to buy their home because all the millennials can't afford anything that big. The most of them aren't having families to fill those houses with anyways. So basically you've got them all fighting over the same small properties.
The boomers end up getting the smaller properties, then the millennials are priced out of the market entirely. It meanwhile, you know, you have. All the usual players we've talked about before, purchasing up these properties for, you know, cash on the dollar, you know, pennies on the dollar, and then renting them out to, you know, I, it's diff I guess, difficult, you know, is the, is the Joe Everyman here to see this and seeing as anything other than a game. Like I think that was my first interest in the whole IBC thing. Is that like. Well, here's a way to play with their rules as opposed to rules. Because it is a game.
It's a game for them that they always win. They're always gonna win, and as long as you keep playing the game by their rules, you can't do anything but lose. Yeah,
Education First [8:00]
Rob Brayton: I totally agree with you on that, Nick. That that is part of it. It's figuring out the game it's seeing. What's going on and then doing something about it.
And I think that's the big challenge is a lot of times people won't do anything about it. They'd rather just complain, well, there is something that we can do at a micro you and me level, and that's start to play the same game on our own with what we have and that can grow, that can expand, et cetera.
There's the only limit to our own personal success is us. So it's, if we can take the time, we can educate ourselves, we can learn what people are doing, and we can apply that in our own sphere. We have an opportunity to make the right steps forward. Does that fix the monetary system? Does that fix, you know, how expensive things are?
Not necessarily, but it allows us to at least keep pace and keep moving it in a positive direction and hopefully be able to start instituting or maybe championing some change in our area. You know, in our local economy, you know, there's things that we can do on that front. So it's beginning to act first and foremost as important, but we have to, before we do that, we gotta educate ourselves.
And that's a big part about what we do here is focus on education. Helping people to learn and understand the game that's going on so they can do something about it.
Step One: Take Responsibility [9:00]
Luke Tatum: Right? We, I mean, we've got a five step approach, right? And step one is take responsibility and really and truly. You could say it's a one step process.
'cause if you take responsibility, if you actually go to where those, you know, all the, all the things that will come from you taking responsibility lead you to the truth. You know, if you're, if you're relentless about taking responsibility for yourself, you'll get to where you need to go at some point. It might not be an easy path.
You may have a lot of things you've gotta figure out. I mean, It wasn't easy for me. Okay. But. That's really what it's about is taking back the control from these disinterested, callous third parties. You know, where you're just a number, you're just a statistic, right? I mean, it's, they don't care. The bank is gonna lend you money to do something if it's a good deal for them.
That's all. They don't care that you need to get a house. They don't care that you need to buy groceries. Right. The organization can't care. 'cause the organization isn't a thing. It's only people. And those people, their paycheck, to your point, Nick, those, their paycheck depends on them sticking to a set of rules.
They are not gonna stick their neck out for Joe Everyman. Right. To be able to feed his family
What Your Credit Score Really Measures [10:00]
Rob Brayton: Well and it's funny right. The credit score, right? All that. All that is just a, Hey, this person's a great money maker for the bank. That like, that's what that score means. It I, of course, I want lots of those people with a high credit score because they're gonna use lots of money back to me.
Nicky P: Very specifically, it is a rating on your likelihood to pay them back. That's it. Yes.
Luke Tatum: Yeah. How do banks make money? Loans. They make loans right in fact.
Nicky P: What's a, what's a, what's a good way to get, make your credit score go bad.
Rob Brayton: Don't take loans, pay off your debt and pay everything off. Pay everything off.
Yep.
Nicky P: Yeah. You're a bad money maker if you don't owe them money.
Luke Tatum: It's, and we wonder why, you know, the US has a debt-based economy and, you know, we have a federal reserve system and all these things. It's like, you know, the bankers won the battle. For control over the US economy. Like this fight was over a long time ago.
Rob Brayton: Yep. 1913. That's right.
1913 and Jekyll Island [11:00]
Luke Tatum: And so, you know, can I time travel back to 1913 and stop the meeting on Jekyll Island? No. I can, but, or, you know, prior to 1913, what have you, but I can take control today. I can stop feeding those systems. I can educate myself and those around me. You know, I can spread awareness, those sorts of things, you know, of alternative systems.
I think in the last episode we talked about the public banking system and the private banking system, and so which one do you wanna play in The one that's run by. Probably some of the most evil people who've ever lived. I mean, I don't, that's not really interesting to me. Do I have a bank account?
Sure.
Even the Cash Flow Crowd Relies on Debt [12:00]
Nicky P: I wanna, I also, I wanna point something out here and that we're having this conversation and it's a little frustrating at times that. Even like even within, like you'll say, the cash flow community, the people that you know wanna teach you how important cash flow is and more important than you know.
Well, there's a lot in a lot of ways those people are kind of, they're I generally, I'd say more on our side, not on our side. The frustration there is that even in their best approximations of how to play this game. You are still, it's still always about the debt. So it's like the real rule of thumb is, hey, it doesn't matter how your leg got broken, you still need to finish the race and you wanna finish it easier or harder.
Leverage Rules Aren't the Same for Everyone [13:00]
Luke Tatum: And the thing that frustrates me about that, I'm glad you brought this up, is. Everything is hunky dory with banks and like, you know, using debt to finance rental properties to do x and y. You know, all the stuff that we're told is great ways to make money, right? It's all fine until all of a sudden it isn't right.
You have one thing go wrong and then all of a sudden it's not that easy. To get those things done. It's you're in a bad spot and it may ruin your life if you're following like a Robert Kiyosaki playbook or something, right? And you're just getting started. When you get to a certain point and you've got tons and tons and tons of diversified assets across multiple states and maybe multiple countries and you own multiple businesses and all these things, maybe it's not that big of a deal.
You can localize your losses and move on. It still hurts, but maybe it's not the end of the world. But you've gotta get to that point. You know, if you're, I've got $10,000 a year to try to make something happen, and I'm just getting started. I just got a huge promotion. I wanna take advantage of this and cash flow into something that can change my life long term.
Oh, the same rules do not, does not apply to that person. That applies to Robert Kiyosaki, you know, or whoever. I'm not picking on him 'cause his books are great.
Who Owns the Debt? Delinquencies Rising [15:00]
Rob Brayton: I was just gonna say, Luke, like the whole concept of leverage, like there's nothing wrong with that concept, and I think using it in the right way is fine.
The problem is who's the owner of, ultimately the owner of the asset? Because if somebody else owns all that debt, so to speak. That's your primary cashflow source. They control it. And when we think about control, if we're giving up that control by leveraging that third party, it, all it takes is that one thing.
And, you know, looking at the Fed data from New York and starting to see a lot of these delinquency rates, 90 days delinquency rates increase in since 2022 in virtually all areas. It's not, it isn't. All it's gonna take is one of those to like start to spike, then you're gonna see a tremendous pullback in credit and that that's where things start to get scary for people.
So, I mean, it just kind of ties into what you were, where you were going with that.
$18 Trillion and a 4.4% Savings Rate [16:00]
Luke Tatum: No, perfectly. Perfectly. And I mean, I don't have savings rate data in front of me and stuff, but like I always like to look at the savings rate and see, you know, how much people are actually able to live. Above what they need to survive and, you know, put away, right?
Because when we talk about capital accumulation, we talk about the actual wealth of the world or of the US or whatever. You know, you've gotta have savings, you've gotta be able to build assets. You know, you have to have stuff, you have to, you have to build the factory or whatever. You know, there's things.
That must occur. Everything in the world can't be leveraged because then there's nothing there, right? It's a paper trail that just, it just burns right up. It's just gone as soon as anything goes awry. And so looking at that, that debt chart that, from the Federal Reserve Bank of New York, I mean, it is just crazy total consumer.
Debt in the US now has over $18 trillion. So, but I mean, we're talking about credit cards to start credit card debt being over a trillion, that's not really a good thing either. You know, it's all bad when it comes to that and. This just shows like people need to buy stuff. They still need to buy stuff, they still need to put food on the table.
They still need to do all this. Savings rate is not good. I don't know what the number is. That's great. 4.4.
Rob Brayton: I actually just checked in from the St. Louis Fed. There you go.
Luke Tatum: That is not great. No, that is not great. And so, you know, what does that tell you? I'd rather put this on a 40, I mean, excuse me, a like 27%.
Credit card, you know, and of course you don't look at what that actually means over time, right? Something, 40 something percent of those people are carrying a balance is what the chart shows. 46% carried a balance at least once in the last year. That is a lot. You carry in a balance for one month, that is a lot of money.
And so that is just the desperate straits that we're in and that's kind of how you pitched this episode to me, Rob, was to say, Hey, you know, the economy we're being told left and right, the economy is doing great and rah, current administration, you know, whatever. But. Are we just putting a bandaid over some things here, like that's not a good sign?
By Design [18:00]
Rob Brayton: Yeah, I, when you think about it, and, you know, I would just challenge anybody, you know, like what Luke was talking about earlier, to really do some education and dig in and understand our monetary system. But when you start to really look at it and you really go back in history, and then you look at where we're at today, sadly, a lot of this is on purpose and I know that's not, doesn't feel good.
But it is by design and it's a way to siphon off wealth from the average person and put it into the banking system. And I know that sounds terrible, but that is how our money system, that's how our nation is structured at the moment. And the only way that it changes is if there's a large enough contingent of people.
That are willing to work and operate outside of that system. And that's a lot of what we do within the infinite banking community is help to put people in a position where we're operating outside of that system because we're operating in a hundred percent reserve system. And when we do that, we can, you get enough people, you can actually start to put real pressure onto these people that make a lot of these decisions.
And I know it would be extremely painful for people. But if you truly wanted to see a dramatic shift and a dramatic change in your personal situation, there's pain there that has to happen in order for it to actually get better. And what I mean by that is you actually have to cut the money supply and it things have to decrease in price as a result.
And that, that period of time it takes for that to happen is, that's the hard part. But if you're properly capitalized, if you have set yourself up to be able to go through that. You're gonna be in that much better situation to be able to make it happen. And that's part of, again, part of the process of what we're, what we're here to do and help educate people to do
Nicky P: So.
Paint me the picture. Paint me a rosier picture. Paint me what the world looks like for the opt-out.
Opting Out [20:00]
Luke Tatum: Yeah. Shoot. So. Opting out of the system, right? Like first of all, it is possible. To Rob's point, you can, I mean, again, I have a checking account. I have a savings account. We do keep money in a bank, a regular old bank, okay?
But you have the ability to accumulate your wealth warehouse, your wealth in a different location. It does not have to be in this public banking system. You can use a hundred percent reserve banking, which is. Insurance, the insurance world. And that probably, I mean, you know, make your eyes roll back in your head.
You're just the most boring sounding thing in the world. But I used to think that too. And here I am, you know, so the insurance world is totally accounted for, up and down, left and right, everywhere. They've got their ducks in a row, and these companies are, you know, a hundred plus year histories of paying dividends to their shareholders consistently, or I should say policy owners, not shareholders.
And it's incredible. It's incredible that your wealth is increasing every single day just because you are alive again, the next day. You didn't die in your sleep, you, congratulations. You know, and it's awesome. And it gets it a better and better rate over time, and you can deploy that on your terms, your repayment schedule, however you wanna do that for.
Anything a bank would tell you no for some crazy investment idea you have, it doesn't matter. You're not asking a bank, you're asking a life insurance company, and they're required by contract to say yes. So, it's good stuff. I mean, Rob, anything you wanna add to that?
From 8% to 35% Savings [22:00]
Rob Brayton: I mean, I'll say, you know, personally speaking like I've implemented this process and I, it's paying dividends, not, I mean, figuratively and literally, right.
You know, we have so much more control over our finances than what we did before. And I mean, myself personally, my savings rate went from, give or take eight ish percent, which, you know, I shockingly I was much better than the average, but we went from about 8% to 35% in the space of two and a half years.
So, like, it's possible, and it sounds crazy, if you would've told me that I, that's how it would've been for us, I would've said, you're nuts. Like for real. I would've said you're crazy. But the fact that we're able to do it and do it in such a short amount of time is amazing because of what it will do for us, my children, my grandchildren, all that, right?
And everybody has that opportunity, or at least the vast majority, especially if you're disciplined, like you can make this happen.
Luke Tatum: Yeah, almost everybody. Almost everybody. It'd be better to pursue and find out that there's some reason you can't than to just go, oh, that's for rich people. And like, you know, just like, no.
The whole point is that it's not for rich people.
Rob Brayton: It's at the you and me level. That's what Nelson structured it as.
Nicky P: Right on. It's about that time. Gentlemen, why don't you take us outta here?
Outro and Free Toolkit [23:00]
Luke Tatum: Yeah, you bet. So thanks again as always everyone for joining us on this week's episode of the Between The Lies Podcast.
If you watch this full episode, then you're definitely interested in the future of money. We've got a free toolkit. To help you demystify the future of your money, head on over to perfectspiralcapital.com/podcast or click the link in the description and grab your free toolkit today. That's gonna have a copy of my book and all kinds of other resources just waiting for you.
Thanks so much for watching.
