A growing share of Americans are losing confidence in their financial footing, as paycheck-to-paycheck stress becomes a defining feature of the economy rather than a temporary condition.
The latest PYMNTS Intelligence installment of “New Reality Check: The Paycheck-to-Paycheck Report” finds that nearly 7 in 10 U.S. consumers now live paycheck to paycheck, with confidence in both household finances and the broader economy deteriorating at the same time. More than 1 in 4 consumers, or 26%, reported difficulty paying bills in the most recent month, the highest level in at least two years.
Dissatisfaction Is Broad and Growing
The report shows that dissatisfaction is not confined to any single demographic. Financial strain cuts across income levels, geographies and household structures. Even among higher-income households earning $100,000 or more annually, consumers in rural areas report persistent financial pressure. Thirty-four percent of rural consumers struggle to pay bills, compared with 24% of suburban consumers.
Single adults with children face especially acute stress. Forty-four percent report difficulty covering monthly bills, more than double the rate of married individuals without children. Certain age cohorts are also under pressure, with bridge millennials reporting higher levels of financial strain than other generations.
The erosion of confidence is reflected in broader economic sentiment. Nearly half of all consumers, 46%, say they are pessimistic about the U.S. economy, compared with 34% who remain optimistic. Among those already struggling to pay bills, 52% believe the economy will get worse.
What’s Driving Financial Stress
The data shows that financial stress is rooted in a combination of rising everyday costs and uncertainty about income stability. Nine in 10 consumers report feeling financial stress, underscoring how pervasive the pressure has become.
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Consumers point to several specific stressors that are weighing on household finances:
- Cost of food (56%) — Food prices are the most frequently cited source of stress, reflecting the persistent impact of inflation on essential spending.
- Inflation overall (55%) — More than half of consumers identify inflation itself as a financial stressor shaping their outlook and behavior.
- Rising costs as the top stressor (23%) — Nearly one-quarter of respondents say rising costs outweigh all other financial pressures.
- Housing and utilities — Housing-related expenses are a major strain, particularly for consumers living paycheck to paycheck, who are three times as likely as financially stable consumers to cite housing costs as a key stressor.
- Debt obligations — Debt compounds stress for financially struggling households, again at rates roughly three times higher than among those not living paycheck to paycheck.
How Consumers Are Coping
As stress intensifies, consumers are recalibrating what financial stability looks like. For many living paycheck to paycheck, stability no longer means building savings or discretionary spending. Instead, it means simply covering everyday expenses without borrowing.
Among consumers struggling to pay bills, 45% say that being able to cover regular expenses without taking on debt defines financial security. Yet nearly half of these consumers, 46%, believe that even this goal is out of reach.
Coping strategies are therefore increasingly defensive. Consumers are prioritizing bill payments, cutting discretionary spending and redefining success in narrower terms. By contrast, households not living paycheck to paycheck are far more likely to report that they have already achieved key financial goals, such as spending on discretionary items without checking budgets or handling unexpected expenses without borrowing.
Job market uncertainty adds another layer of stress. The report found 3 out of 5 employed consumers do not expect a salary increase in the next year, while 10% say their job feels unstable. Confidence in finding a comparable new job is limited, with only 34% believing they are highly likely to secure a role that meets both wage and qualification requirements if needed.
Taken together, the findings show a paycheck-to-paycheck economy under sustained pressure, where stress is reshaping consumer sentiment, financial behavior and expectations for the future.
