Current Events > 62% of Americans are living paycheck to paycheck, making it their lifestyle

(+) Yeah! (+)

https://www.cnbc.com/2023/10/31/62percent-of-americans-still-live-paycheck-to-paycheck-amid-inflation.html

High inflation and higher interest rates continue to weigh on American households. As of September, 62% of adults said they are living paycheck to paycheck, according to a new LendingClub report. The figure is unchanged from last year. Living paycheck to paycheck remains the main financial lifestyle among U.S. consumers, the report said. Many households are seeing their finances stretched thinly by the combination of high prices for goods and services as well as high interest rates, said Brett House, economics professor at Columbia Business School. Many are having to make tough choices to defer discretionary spending in order to stay on top of their loan payments and the costs of necessities, he added. The resumption of student loan payments only adds to this stress. Some 74% of Americans say they are stressed about finances, according to a separate CNBC Your Money Financial Confidence Survey conducted in August. Inflation, rising interest rates and a lack of savings contribute to those feelings. Many households have tapped their cash reserves over the past few months, LendingClub and other reports show.

Nearly half, or 49%, of adults have less savings or no savings compared with a year ago, according to a Bankrate survey. On the upside, those with remaining balances, which are concentrated among high-income households, are seeing better interest payments than theyve received at any time in the recent past, House said.

That doesn't sound like it will end well if people start losing their jobs in a recession.

Our economic system is definitely reaching a breaking point. We still never recovered from 2008 tbh

Obviously the solution is to give enormous tax breaks to the billionaires, be dicks to transgenders, gays, black people and foreigners and impose strict religious teachings on children instead of basic education.

Only a communist can't see that!

Jerome Powell will save us

The Speaker of the House will blame the legalization of no-fault divorce.

Im going to sit in the street until someone fixes this

I'm sure the problem is that billionaires aren't rich enough yet. Once they are then surely the wealth will finally start trickling down.

R1masher posted...

Im going to sit in the street until someone fixes this

Didn't Occupy Wall Street try this plan years ago? Im not sure thy accomplished their goals with that plan.

BlueTigerLion posted...

That doesn't sound like it will end well if people start losing their jobs in a recession.

Itll end as badly as it always has when a recession hits. A few years of economic hardships until it inevitably recovers along with the status quo until the cycle repeats itself.

Prismsblade posted...

Itll end as badly as it always has when a recession hits. A few years of economic hardships until it inevitably recovers along with the status quo until the cycle repeats itself.

You forgot the part where the new status quo is much worse than the previous one

What does paycheck to paycheck even mean?

The median American household spends about 9.9% of income on debt payments, down from 14.7% in 2010, despite the Fed's rate hikes.
https://gamefaqs.gamespot.com/a/user_image/3/3/4/AADgb_AAE_au.jpg
The median American household has around $8000 in liquid cash, in addition to whatever other assets they hold.

https://gamefaqs.gamespot.com/a/user_image/2/3/2/AADgb_AAE-54.jpg

BlueTigerLion posted...

Some 74% of Americans say they are stressed about finances

Exactly what the GOP want.

Most people dont know how to manage money (thanks school) or don't know how to deal with delayed gratification (thanks.... everything)

Agonized_rufous posted...

Most people dont know how to manage money (thanks school) or don't know how to deal with delayed gratification (thanks.... everything)

So did people suddenly get worse at managing money over time? Because there was once a time when Americans didn't face nearly as much financial insecurity.

RchHomieQuanChi posted...

So did people suddenly get worse at managing money over time? Because there was once a time when Americans didn't face nearly as much financial insecurity.

It's curious how everytime there is a shift to right wing government, suddenly everyone forgets how to manage money.

emblem-man posted...

What does paycheck to paycheck even mean?

It means exactly what it means...whatever income that person earns, the majority of it goes towards living expenses of some kind (with rent/mortgage eating up the most), leaving very little left over to save for other things.

Hence why something like a sudden expense like hospitalization can easily put such person in the hole.

UnfairRepresent posted...

It's curious how everytime there is a shift to right wing government, suddenly everyone forgets how to manage money.

Would make sense, with the right's constant attack on education!

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This. Fucking pay people.

Agonized_rufous posted...

Most people dont know how to manage money (thanks school) or don't know how to deal with delayed gratification (thanks.... everything)

That absolutely is a major issue, but even those of us that managed our money well in the past are having troubles after the pandemic. At one point I was living off half of my regular monthly income and had to start using my emergency funds.

BombermanGold posted...

It means exactly what it means...whatever income that person earns, the majority of it goes towards living expenses of some kind (with rent/mortgage eating up the most), leaving very little left over to save for other things.

Hence why something like a sudden expense like hospitalization can easily put such person in the hole.

And I don't think that's true because the median household networth in 2022 was $193k.

That includes $39k in financial assets and $8k in transaction(checking or savings) accounts.

Im sure we just need to reduce the minimum wage some more and then blame people for not tipping enough/at all. Its all the fault of the non-tippers

Gonna get worse before it gets better.

emblem-man posted...

And I don't think that's true because the median household networth in 2022 was $193k.

That includes $39k in financial assets and $8k in transaction(checking or savings) accounts.

I think median salary would be a better stat to use to get an understanding of the paycheck to paycheck lifestyle than using net worth. Since networth includes people homes and a lot of people rent or dont even have spare money to put into the stock market let alone their savings.

BlueTigerLion posted...

I think median salary would be a better stat to use to get an understanding of the paycheck to paycheck lifestyle than using net worth. Since networth includes people homes and a lot of people rent or dont even have spare money to put into the stock market let alone their savings.

Which is why I include the liquid amount they have in checking or savings.

I'm not saying people aren't having difficult times, but I just hate this paycheck to paycheck statistic because it doesn't match what the data actually says.

RchHomieQuanChi posted...

Our economic system is definitely reaching a breaking point. We still never recovered from 2008 tbh

Every recession widens the inequality gap. Companies use these as excuse to fire employees, cut corners without getting back all the benefits once things are good again. 90s were probably the peak and its been downhill since then.

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Naah. Know the average person, finance managing IS a problem. Almost everyone updates their lifestyle once they get big pay raises. The so called "I work hard so I deserve it" definitely screws up a lot of people, specially younger. Many people could earn double what they do now and still complain.

Inflation is just a wealth transfer. The war machine is going to drive up inflation and Janet yellen is going to keep printing money to fund two wars, so I guess the rich are getting richer and the poor are pretty much smoked.

Minimum wage is still $7.25/hr. Thats 15k a year BEFORE taxes. Thats bullshit to me.

minimum wage should be raised to $20/hr at this point. And dont give me this shit about oh thatll cause inflation.

no it wont. You know what will cause inflation? These corporations who would raise the price of EVERYTHING so their CEO can still make millions and millions instead of just paying their workers a fair wage.

America and capitalism are beyond fucked at this point.

CEOs: "Almost there. Soon it'll be 90%."

RchHomieQuanChi posted...

You forgot the part where the new status quo is much worse than the previous one

For some, and for others a massively beneficial opportunity.

Well at this rate given the strong gdp numbers theyre going to keep hiking interest rates. even though thats the most counterintuitive thing because its not consumer demand thats at the heart of inflation but government spending. Furthermore the cause of inflation is fiscal driven (due to war spending etc) not excessive bank lending. Once the consumer cracks and they force a recession theyll probably double back but the economy will be destroyed by then and the damage will have been done.

Prismsblade posted...

For most, and for a minority of others a massively beneficial opportunity.

Fixed that for ya

RchHomieQuanChi posted...

So did people suddenly get worse at managing money over time? Because there was once a time when Americans didn't face nearly as much financial insecurity.

Part of it is how easy it is to use a credit card. I am old so I remember when people in line would get pissed if you pulled out a credit card. They had to make a carbon copy, write down your address (I think) so people really didnt use them too much.

Also jobs with no education beyond high school used to be better. Many machine shops would take you on and train you. A lot was automated and a lot more overseas so most of those jobs are gone.

Cuticrusader09 posted...

Part of it is how easy it is to use a credit card. I am old so I remember when people in line would get pissed if you pulled out a credit card. They had to make a carbon copy, write down your address (I think) so people really didnt use them too much.

Also jobs with no education beyond high school used to be better. Many machine shops would take you on and train you. A lot was automated and a lot more overseas so most of those jobs are gone.

I remember talking to some older folks who were saying annual cost of living adjustments for workers used to be common, but now not so much. In fact, that's one of the things the UAW strike is over. The big automakers stopped giving cost of living increases to workers just after the 2008 financial collapse, which they said at the time as a temporary measure, but then just never brought that back.

It should be understood that this is not a failure of the system.

It's a mixture of wages not keeping up with inflation and people being piss poor at managing their money.

Goldenguy posted...

It's a mixture of wages not keeping up with inflation and people being piss poor at managing their money.

its housing thats really screwing people over. They have spent more then half of their income to keep up with rising housing costs.

meatlesshotdogz posted...

America and capitalism are beyond fucked at this point.

The only real takeaway here

Im glad I live in a decent low cost of living area of the Midwest. Money goes a lot further here and you can live quite well on a moderate salary. Thats not to say inflation doesnt exist here. It does. Groceries have gone up, vehicle prices are getting ridiculous, and houses have risen but it hasnt been impacted as badly is all and there is still reasonable housing available.

So glad Ive never had to live check to check. The only thing that will keep me working and prevent early retirement will be insurance. It wont be money. Having my house completely paid off and no mortgage makes my monthly living expenses quite cheap compared to my monthly earnings. Even when I had a mortgage I saved a chunk of money each month and lived comfortably.

I truly feel bad for those who struggle while living within their means. Must be an awful stressful way to go through life.

We dont need no education! Hey, teacher, leave those kids alone!

in all seriousness kids would probably be better off becoming plumbers and learning real life skills than going into debt to fund college at this point.

archizzy posted...

Im glad I live in a decent low cost of living area of the Midwest. Money goes a lot further here and you can live quite well on a moderate salary. Thats not to say inflation doesnt exist here. It does. Groceries have gone up, vehicle prices are getting ridiculous, and houses have risen but it hasnt been impacted as badly is all and there is still reasonable housing available.

So glad Ive never had to live check to check. The only thing that will keep me working and prevent early retirement will be insurance. It wont be money. Having my house completely paid off and no mortgage makes my monthly living expenses quite cheap compared to my monthly earnings. Even when I had a mortgage I saved a chunk of money each month and lived comfortably.

I truly feel bad for those who struggle while living within their means. Must be an awful stressful way to go through life.

Midwest is best. Can't help but laugh at the coastal elitists who think "being at the heart of it all" is worth paying a massive premium on everything.

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I agree with this. I will say though, it feels like some people think Midwest states don't have large urban cities that have large and varied amenities.

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I mean, Chicago has most if not all of those things and the COL is like, 50% less or something than being on the coast. Milwaukee seems to also be on something if an urban revival, albeit slowly. Minneapolis is a major metro that has those things listed. I'm sure the smaller cities of Indianapolis, KC, and St. Louis also have their own draws (can't comment on them, haven't been there or done research).

There's more to the Midwest than just farmland and the Rust Belt. The area has amenities, good COL, affordable housing, and good jobs. You just need to know where to look.

Yeah like Deluth

Xenogears15 posted...

I mean, Chicago has most if not all of those things and the COL is like, 50% less or something than being on the coast. Milwaukee seems to also be on something if an urban revival, albeit slowly. Minneapolis is a major metro that has those things listed. I'm sure the smaller cities of Indianapolis, KC, and St. Louis also have their own draws (can't comment on them, haven't been there or done research).

There's more to the Midwest than just farmland and the Rust Belt. The area has amenities, good COL, affordable housing, and good jobs. You just need to know where to look.

Did you intentionally list multiple absolutely dogshit areas? Also, I live in Chicago, and not downtown, and it's still expensive with insanely difficult to find housing.

FolkenRawr posted...

Did you intentionally list multiple absolutely dogshit areas? Also, I live in Chicago, and not downtown, and it's still expensive with insanely difficult to find housing.

I love here too, and I can say that it's easier to find housing here than on the coasts (basing that iff of information of friends and family that live there). Yeah, things are bad.

Those places may be dogshit by your estimation, but that doesn't mean they actually are. Or that they'll be dogshit to someone else. I'm not saying they're perfect, but they're not hellholes, either. Especially Minneapolis, wtf?