The Wealth and Debt of Danish Families - Part 2

Monetary review, 2nd Quarter 2012

Authors Andersen, Asger Lau; Christensen, Anders Møller; Nielsen, Nick Fabrin; Koob, Sigrid Alexandra; Oksbjerg, Martin; Kaarup, Ri
Subject Danish Economy
Type Monetary Review  
Year 2012
Published 16 July 2012
Compared with other countries, Danish households have a very high debt-toincome ratio. Internationally, this has attracted considerable negative attention. In this article, on the basis of register data at family level we look into the composition of gross debt for families in different income and age groups and the degree to which the debt is offset by various types of assets. The results show that Danish families are frequent users of the financial system, since gross debt is generally offset by even larger assets. The balance between gross debt and assets can be explained especially in terms of family income, age, house prices and the structure of the pension system. Given the current economic outlook, the extent of the actually indebted families cannot be assumed to pose a threat to the household or the financial sector.