In July 2023, 61% of U.S. consumers live paycheck to paycheck, unchanged from June 2023, but 2 percentage points higher than July 2022. Generally, more consumers of all income brackets reported living paycheck to paycheck in July 2023 than last year
The share of low-income consumers — those earning less than $50,000 annually — living paycheck to paycheck increased the most, rising from 74% in July 2022 to 78% in July 2023.
Among consumers earning between $50,000 to $100,000 annually, 65% lived paycheck to paycheck as of July 2023, compared to 63% in July 2022.
Meanwhile, the share of high-income consumers — those earning more than $100,000 annually — living paycheck to paycheck increased the least, just 1 percentage point from 43% in July 2022 to 44% this year.
the study revealed living « paycheck-to-paycheck » is independent of how much money one makes, and a majority of Americans need their next paycheck to cover their monthly financial outflows.
rising interest rates make carrying a balance on credit cards even more expensive, meaning servicing that debt costs more, leaving less for savings
Twenty-one percent of paycheck-to-paycheck consumers cite nonessential spending as one reason — but not the top reason — for their financial lifestyle
about 6% of the U.S. adult population can be considered ‘discretionary’ paycheck-to-paycheck consumers, as their financial lifestyle is due to nonessential spending, while 13% of U.S. consumers live paycheck to paycheck at least partly because of nonessential spending
People like to splurge on themselves, even when it isn’t necessary.
Seventy-four percent of consumers admit to including « nice-to-have » items in their grocery carts at least some of the time, and 70% say the same for their retail purchases
For grocery shoppers, desserts, candy and sodas were among the most common indulgences, with 41% citing this as their latest grocery splurge. Clothing emerged as the top non-grocery splurge, followed by health and beauty
According to the Federal Reserve Bank of New York, U.S. consumer credit card debt has risen to an all-time high of $1.03 trillion as of the second quarter of 2023
The reality is that many Americans are using credit cards as a crutch instead of a tool
Americans have an average of four credit cards and are swiping on those cards without thinking about the consequences of carrying high-interest credit card debt at variable rates.
The average consumer holds outstanding credit card balances equivalent to 35% of their available savings, but those living paycheck to paycheck tend to have higher credit card debt relative to their savings level
The data finds that consumers living paycheck to paycheck without issues paying bills have average outstanding credit card balances equivalent to 62% of their available savings, while those with issues paying monthly bills carry balances of 157% of their available savings, meaning they would still have a balance even if they emptied their savings accounts.