The biggest threat to the summer budget may be the expenses consumers can’t cancel. New PYMNTS Intelligence data suggests that groceries, utility bills and transportation costs are putting more pressure on household budgets than vacations, camps or back-to-school shopping.
The findings come from “New PYMNTS Data Shows Basic Expenses Breaking the Summer Budget,” the latest installment of The Paycheck-to-Paycheck Report. Based on a survey of 2,881 U.S. adults conducted from July 1 to July 9, the report examines the expenses consumers say are straining their finances, the households most exposed to seasonal pressure and the likelihood that those costs will extend beyond the summer. The overall share of consumers living paycheck to paycheck held at 67% in July, but the data shows how quickly additional costs can tighten budgets. The report also found that 14% of consumers who started the summer outside the paycheck-to-paycheck lifestyle have since moved into it.
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This finding illuminates an important reality for banks, payments providers and consumer-facing businesses. Consumers may have some control over discretionary purchases, but they have far less flexibility when food, electricity and transportation take up a growing share of their budgets. That creates an opportunity for financial institutions and payment providers to help consumers better manage recurring expenses and plan for seasonal increases.
Key findings:
- 53% of consumers cite groceries as a source of financial pressure, making them the most commonly cited expense in the report. Utility bills follow at 46%, while gas or transportation costs account for 36%. By comparison, 19% cite travel as a pressure, while 10% cite back-to-school shopping.
- 79% of consumers cite at least one unavoidable cost as a source of summer pressure. Only 41% cite a summer-specific cost.
- 72% of consumers who already feel pressure from utility bills say those costs rise during the summer. That compares with 41% of consumers who identify grocery costs as a pressure and say those expenses increase during the season.
The numbers suggest that summer budgeting has become less about preparing for a major purchase and more about managing a series of recurring expenses. Utilities are a particularly interesting case, as they are both an everyday necessity and a summer-specific cost, increasing during warmer months as consumers use more air conditioning. Roughly one-third of consumers say utility costs pressure their budgets during the summer, ahead of groceries, fuel and travel. Fifty-eight percent of consumers expect to still be paying off summer expenses after the season ends, including 77% of Gen Z consumers.
Yet the data also points toward a constructive opportunity for financial services providers. Better tools for forecasting recurring bills, setting aside money for seasonal expenses and smoothing payments across the year could help consumers turn a summer squeeze into a more manageable financial planning challenge.
At PYMNTS Intelligence, we work with businesses to uncover insights that fuel intelligent, data-driven discussions on changing customer expectations, a more connected economy and the strategic shifts necessary to achieve outcomes. With rigorous research methodologies and unwavering commitment to objective quality, we offer trusted data to grow your business. As our partner, you’ll have access to our diverse team of PhDs, researchers, data analysts, number crunchers, subject matter veterans and editorial experts.
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