Why are we always struggling financially?
It may be that you have too much credit card debt, not enough income, or you overspend on unnecessary purchases when you feel stressed or anxious. Or perhaps, it's a combination of problems. Make a separate plan for each one.
The US Bureau of Labor Statistics indicated that the shock to food and energy prices, supply chain issues, and an increased demand for products all contributed to the sharp rise in inflation. Fast forward four years and most Americans are still struggling.
36% of U.S. adults have more credit card debt than emergency savings, as of January 2023, the highest percentage since 2011. Concerns over job security add additional financial stress. 33% of American workers were worried about their job security, as of April 2023.
- Identify the problem.
- Make a budget to help you resolve your financial problems.
- Lower your expenses.
- Pay in cash.
- Stop taking on debt to avoid aggravating your financial problems.
- Avoid buying new.
- Meet with your advisor to discuss your financial problems.
- Increase your income.
According to a recent Ramsey Solutions study, 34% of survey respondents indicated that they were either facing financial struggles or were actively in crisis.
A majority, 65%, say they live paycheck to paycheck, according to CNBC and SurveyMonkey's recent Your Money International Financial Security Survey, which polled 498 U.S. adults. That's a slight increase from last year's results, which found that 58% of Americans considered themselves to be living paycheck to paycheck.
About 65% of working Americans say they frequently live paycheck to paycheck, according to a recent survey of 2,105 U.S. adults conducted by The Harris Poll, asking questions supplied by Barron's.
The survey also found that 37% of Americans are behind on monthly bills, which jumps to 53% among parents with young children. Additionally, 61% reported that inflation has impacted their ability to afford their lifestyle. "Yes, inflation seems to have peaked, but it hasn't gone away," Schulz continued.
Nearly half of Americans will start 2024 in the red
While nearly three quarters of Americans (72%) say they have clearly defined personal finance goals for 2024, many will start in the red. According to the study, nearly half of Americans (46%) expect to have credit card debt heading into 2024.
Census data shows that 4 in 10 Americans are finding it difficult to cover their expenses. If you aren't sure how to pay your bills, don't ignore the problem; make a plan. You may need to talk to the people you owe, explain your situation and ask for help.
Is it normal to struggle financially?
Even before the global coronavirus pandemic and resulting economic fallout, an American Psychological Association (APA) study found that 72% of Americans feel stressed about money at least some of the time. The recent economic difficulties mean that even more of us are now facing financial struggles and hardship.
- Be proactive. Don't wait until the collection agencies start calling. ...
- Prioritize. Life is all about priorities. ...
- Cut back on your savings plan. ...
- Avoid relying on credit. ...
- Create more income. ...
- Make a new budget.
- Speak to a debt counsellor or financial adviser. ...
- Don't be afraid to be vulnerable and accept help in whatever form it takes. ...
- Be brutally honest with yourself. ...
- Strip down your spending and track every last cent. ...
- Work hard.
The official poverty rate in 2022 was 11.5 percent, with 37.9 million people in poverty.
At the end of 2022, 73 percent of adults were doing at least okay financially, meaning they reported either “doing okay” financially (39 percent) or “living comfortably” (34 percent). The rest reported either “just getting by” (19 percent) or “finding it difficult to get by” (8 percent).
SAN MATEO, Calif., Aug. 22, 2023 /PRNewswire/ -- Despite most Americans having modest expectations of what it means to attain financial freedom, just 1-in-10 (11%) report they are living their definition of financial freedom, according to a new survey by Achieve, the leader in digital personal finance.
9% of Americans have between $100,000 and $200,000 saved, and 4% have between $200,000 and $350,000 saved. Finally, 4% have between $350,000 and $500,000 saved, and about 4% have more than $500,000.
12% of *households* have income between $75k and $99,999 and 15.5% are 100K to 150K. 8.3% and 10.3% are above, so about a third of **households** have over $100,000 in income. But that may well mean two wage-earners, or people with more than one source of income.
According to a recent PYMNTS report, as of November 2022, 76 percent of U.S. adults who make less than $50,000 are living paycheck to paycheck, compared to 65.9 percent of those making $50,000 to $100,000 and 47.1 percent making more than $100,000.
There are several reasons why millionaires may live paycheck to paycheck. Some may have high-cost lifestyles, such as expensive homes, cars, and vacations. Others may have large amounts of debt, such as student loans or credit card debt. Still, others may simply be poor at managing their money.
Are you poor if you live paycheck to paycheck?
"Paycheck to paycheck" is an informal expression describing one's inability to pay for living expenses if they lost their income. People living paycheck to paycheck are sometimes referred to as the working poor. Living paycheck to paycheck can occur at all different income levels.
Less than 15% of our survey respondents living paycheck to paycheck reported having more than $2,000 in savings. Roughly one-quarter of respondents living paycheck to paycheck have between $1 and $1,000 in rainy-day savings, while nearly half (47%) have between $1,001 and $2,000 squirreled away.
The Federal Reserve study does not provide numbers for the average credit card balance per consumer. However, according to Transunion, this figure rose from $5,795 in January 2023 to $6,295 in January 2024.
“The resumption of student loan payments, robust personal spending, and rising balances on credit cards and other forms of consumer debt, paired with declining savings rates, are likely behind some borrowers falling behind at the end of 2023,” Marina Walsh, the MBA's vice president of industry analysis, said in a ...
U.S. credit card debt. The higher cost of everything from housing to high-tops to haircuts are a major culprit. Although inflation has moderated since it peaked in June 2022, Americans—particularly lower-income families—are relying more on credit cards to cope with the sticker shock.
