The economy as a whole has proved resilient amid the highest rates in decades. But beneath the surface, many low- and moderate-income families are struggling.

High interest rates haven’t crashed the financial system, set off a wave of bankruptcies or caused the recession that many economists feared.

But for millions of low- and moderate-income families, high rates are taking a toll.

…

The overall economy has proved unexpectedly resilient to high interest rates. Consumers have continued spending on travel, restaurant meals and entertainment thanks to rising wages and debt levels that, despite their recent increase, remain manageable as a share of income for most people.

But aggregate figures obscure an underlying divide that is likely to widen the longer interest rates remain high. Affluent households, and even many in the middle class, have largely been insulated from the effects of the Fed’s policies. Many took out long-term mortgages when rates were at rock bottom in 2020 or earlier — if they don’t own their homes outright — and most have little if any variable-rate debt. And they are benefiting from higher returns on their savings.

For poorer families, it is different. They are likelier to carry a balance on credit cards, meaning they’re more likely to feel high rates. According to Fed data, about 56 percent of people earning less than $25,000 carried a credit card balance in 2022, compared with 38 percent of those earning more than $100,000. Black Americans, like Ms. Dorsey, and Latinos are also more likely to carry balances.

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