A new consumer survey shows 51% of Americans making more than $100,000 a year say they are living paycheck to paycheck and have difficulty paying monthly bills.
Business news outlet PYMNTS and LendingClub, a financial services company, released the 18th edition of their paycheck to paycheck research series on Tuesday. The research found an increase in consumers saying they live paycheck to paycheck, with the most growth seen in the upper income bracket. (RELATED: US GDP Ticks Up, But Recession Fears Remain)
Some 64% of US consumers — equivalent to 166 million people — were living paycheck-to-paycheck at the end of 2022, according to the survey by industry publication @Pymnts and @LendingClub. A lot of them make 100k or more. https://t.co/nB85HmTmD6 via @atanzi @economics pic.twitter.com/gVOtJyK8CV
— Steve Matthews (@SteveMatthews12) January 30, 2023
Nine million more consumers are now living paycheck to paycheck, with 8 million of them earning $100,000 or more annually. The share of upper income Americans living paycheck to paycheck increased to 51% in December 2022, up from 42% in 2021, the survey found. In total, 64% of consumers are living paycheck to paycheck, a 3% increase over the past year.
The amount of high income consumers living paycheck to paycheck who struggle to pay monthly bills increased from 11% in December 2021 to 16% over the past year, the survey found. Financial habits and monthly spending by the upper level consumers living paycheck to paycheck were not disclosed as part of the survey.
As of December 2022, the share of low income and middle income consumers living paycheck to paycheck has stayed constant over the past year. Of those earning less than $50,000, 78% say they are living paycheck to paycheck and 66% of those earning between $50,000 and $100,000 say the same.
“The effects of inflation are eating into every American’s wallet and as the Fed’s efforts to curb inflation drive up the cost of debt, we are seeing near record numbers of Americans living paycheck to paycheck,” Anuj Nayar, financial health officer at LendingClub, said in a press release. “While the number of Americans living paycheck to paycheck is close to the height we saw in the middle of the pandemic, the causes appear to be very different, as the economy is not sheltering in place like it was back in 2020.”
Four out of 10 paycheck to paycheck consumers expect their personal finances to improve over the next year because of job upgrades and additional sources of income, according to the report. Of those who expect a worse financial situation, three-quarters cite inflation as a concern and two-thirds cite economic uncertainty as a reason for pessimism.