The economy is strong, as evidenced by some headline numbers.
Unemployment is at multi-year lows, GDP growth continues apace and the stock market, usually a barometer of at least some sentiment (and with its own wealth effect, of course), is at multi-year highs.
But research that debuted Tuesday (Aug. 28) from the Urban Institute, a non-profit, shows that roughly 40 percent of U.S. families have faced financial struggles in the past year — straining to meet basic needs, such as food or housing.
The research — an inaugural study that will now be repeated annually — spanned 7,600 adults and noted that the struggles were relatively higher among adults who had lower incomes or experienced health issues.
As reported by the Chicago Tribune, the data “revealed that people from all walks of life were running into similar hardships.”
Despite the fact that most Americans have jobs, more than 30 percent of households that featured at least one working adult experienced hardship. Breaking down those challenges, food insecurity was most prevalent, afflicting 23 percent of households. The next most common struggle came from trying to afford medical bills, at 18 percent of those surveyed, and 13 percent of families missed utility payments during the year. Hardships extended to rent and mortgage payments, where about 10 percent of the families surveyed by the Urban Institute did not pay the full amount of those bills, or they were paid late.
The struggles underscore some of the findings in the July Financial Invisibles Report, which found that a sizable chunk of the U.S. population may be struggling. The survey, conducted by PYMNTS in conjunction with Unifund, took the financial pulse of 2,000 U.S. respondents. Of that number, roughly 58 percent could be classified as “no worries” personas, with no collections or delinquencies over the past several years; the remainder fall into various categories spanning “Second Chances,” “On the Edge” or “Shut Outs.” These last two groups make up 35 percent of the population, and are marked by the struggle to pay bills each month and by at least one collections or delinquency event.
The entire sample showed an average credit score of 695 and income of $70,000 annually. More than 60 percent of respondents were employed. Despite that demographic makeup, the On the Edge and Second Chances groups showed that many high income earners are, in fact, living paycheck to paycheck.