Study Shows 60% of Americans Living Paycheck to Paycheck

Study Shows 60% of Americans Living Paycheck to Paycheck

( – During the 1980s, a television sitcom entered American living rooms with its theme song’s iconic opening lines, “making your way in the world today takes everything you’ve got.” Four decades later, the truth of that still holds true and adding something like “… and more” would not be off the mark.

Making Ends Meet

According to a February (reporting on data from January) report put out by PYMNT in collaboration with LendingClub, showed the overall number of Americans living paycheck to paycheck (meaning they have little or no ability to put any savings aside) dropped by 4% year-over-year from 2022. That sounds like good news, right? However, when one considers 60% are still struggling — and the means they are using to survive — the improvement is of little consequence.

The survey was conducted between January 6 and January 27 and included 4,163 American consumers, and when the numbers are broken down by income level, they’re a bit shocking. Of those who made more than $100,000 per year, nearly half (45%) reported experiencing that struggle, and for people making less than $50,000 annually, that number jumps to a shocking 74%.

The news has been full of stories of the staggering rate of inflation that has gripped the country since President Joe Biden took office in January 2021. These rising prices have put immense pressure on the budget of most Americans. Luxuries, even small ones, like eating out, extra treats from the grocery store, and entertainment options, have all taken a backseat to essential needs.

Credit Cards to the Rescue?

Unfortunately, according to TransUnion, many people are being forced to leverage today’s needs against future debt by racking up expensive credit card debt. Nationally this has hit a record of nearly $1 trillion ($930.6 billion), which means the average balance being carried is a bit more than $5,800 per person at the end of 2022. That represents an increase of approximately $145 billion from the end of 2021. The number of credit cards in use rose by 32.5 million during the same time.

There are a few ways Americans can get a small amount of help if things get too tight, such as:

Also per TransUnion, many consumers turned to home equity lines of credit (HELOCs) and home equity loans (HELOANs) at a fast clip in Q3 2022, with mortgage lenders only just beginning, “a gradual shift away from below prime borrowers.” According to the North American residential real estate brokerage Redfin, the total value of homes in the United States fell off a $2.3 trillion cliff (4.9%) between June and December 2022, which makes it “the largest June-to-December drop in percentage terms since 2008.”

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