When budgets tighten, what do consumers cut first? And what will they protect for as long as they can? Regardless of financial circumstances, consumers in the U.S. share some key priorities. Mortgage or homeownership costs top the list of expenses they would prioritize most, while purchases they can easily do without are early candidates for cuts.
Beyond these broad similarities, though, consumers respond very differently to financial stress depending on their circumstances. Those struggling to pay bills are more willing to cut some regular discretionary purchases, while those not living paycheck to paycheck are more inclined to keep them.
Subscriptions illustrate this divide. Among those who buy subscriptions and consider them discretionary, 60% of consumers struggling with bills would cut them first, compared with 39% of those not living paycheck to paycheck. Yet some optional purchases would survive even deep cuts: Roughly one in five discretionary purchasers in every paycheck-to-paycheck group would protect at least one such category for as long as possible.
Key Findings
- Homeownership is the last expense every group would give up.
Mortgage or homeownership costs lead the expenses every financial group would protect until the most, at 23% to 27%. Among consumers who see no good substitute for their last-protected expense, homeownership ranks first for those living paycheck to paycheck but paying bills comfortably, at 29%.
- Consumers call roughly 11 of 22 categories discretionary but spent on roughly two of them.
Those paying bills comfortably spent on an average of 1.9 discretionary categories in the previous 12 months, 24% fewer than those not living paycheck to paycheck (2.5). Both consider approximately the same number discretionary: 10.5 versus 10.1.
- For many, discretionary spending is a real budget item.
Among discretionary purchasers, 40% of those paying bills comfortably rate at least one category as a notable or major monthly budget item. That matches struggling consumers and exceeds the 34% among those not living paycheck to paycheck.
- Optional “wants” get cut first and subscriptions feel the strain.
Every group’s leading reason for cutting a purchase is that it is more of a want than a need. Among consumers who buy subscriptions and consider them discretionary, 60% of those struggling with bills would cut them first, compared with 39% of those not living paycheck to paycheck, the biggest gap between groups among the eight categories compared.
- Roughly one in five would hold onto something they call discretionary.
Among discretionary purchasers, 19% to 20% in every financial group would protect at least one category for as long as possible. Grocery delivery or personal shopping leads among those living paycheck to paycheck but paying bills comfortably, with 12% of buyers who consider it discretionary willing to protect it.
Paycheck-to-Paycheck Trends
Two-thirds of consumers live paycheck to paycheck, a share that has held steady.
Two-thirds of U.S. consumers (66%) lived paycheck to paycheck in September 2026, within the 64% to 71% range recorded since September 2024. One-quarter of these consumers struggled to pay bills, while 41% lived paycheck to paycheck without issues paying bills.
Beneath that steady overall share, the mix has shifted slightly. Those living paycheck to paycheck without issues paying bills accounted for 43% or 44% of all consumers in most 2024 and 2025 readings, compared with 41% in July and September 2026. The share struggling to pay bills stood at 25% in September, within the 21% to 26% range recorded since September 2024.
Homeownership Leads Consumers’ Spending Priorities
Mortgage or homeownership costs take first place across financial lifestyles.
Regardless of their financial situation, consumers most often rank mortgage or homeownership costs as the expenses they would protect the most if their budgets tightened. Roughly 27% of consumers living paycheck to paycheck without issues paying bills and the same share of those not living paycheck to paycheck select this category. It also ranks first among those struggling to pay bills, at 23%.
Homeownership also leads among consumers who see no good substitute for the expense they would protect the most. Within that subset of consumers paying bills comfortably, 29% name mortgage or homeownership costs.
Consumers struggling to pay bills prioritize keeping a car and paying for healthcare. Roughly 12% would hold onto owning or leasing a car, compared with 9% of those not living paycheck to paycheck. The shares for ongoing healthcare are 16% and 12%, respectively. Insurance costs receive similar emphasis in both groups, at roughly 15%.
Similar Views of Discretionary Spending Meet Different Budgets
Consumers living paycheck to paycheck without issues paying bills view optional spending much like those outside the paycheck-to-paycheck economy, but purchase from fewer categories.
What counts as a discretionary expense depends on the consumer. The survey asked respondents to classify 22 spending categories in one of three ways: absolutely essential, a spending choice that is still necessary or a discretionary choice. This report uses the last category for expenses consumers themselves consider discretionary.
Consumers struggling to pay bills classify an average of 55% of the surveyed categories as discretionary, compared with 48% among those without issues paying bills. The share falls to 46% among consumers not living paycheck to paycheck. Those struggling with bills are more likely than those not living paycheck to paycheck to consider 21 of the 22 surveyed categories as discretionary spending.
The average consumer generally buys from just a few of the categories they consider discretionary. Across all respondents, approximately 11 of the 22 categories receive that label, but consumers spent on roughly two in the previous 12 months. Those living paycheck to paycheck without issues paying bills bought from an average of 1.9 categories, compared with 1.6 among those struggling to pay bills and 2.5 among those not living paycheck to paycheck.
Even a few discretionary purchases can take up a substantial part of consumers’ budgets. Among those who made such purchases, 40% of those living paycheck to paycheck without issues paying bills rate at least one category as a notable or major monthly budget item. The share is identical among those struggling to pay bills, compared with 34% among those not living paycheck to paycheck.
Keeping up with bills can therefore conceal a tighter spending picture. Consumers living paycheck to paycheck without issues paying bills resemble those not living paycheck to paycheck in what they consider discretionary spending, but they match those struggling to pay bills in how often those purchases weigh heavily on their budgets.
Everyday Purchases Face the First Cuts
Subscriptions and dining out are vulnerable to cutbacks for consumers living paycheck to paycheck without issues paying bills.
Subscriptions are particularly exposed to tighter budgets. Among consumers who consider subscriptions discretionary and purchased them in the previous year, 57% of those living paycheck to paycheck without issues paying bills would cut back on or cancel them first. That’s close to the 60% among those struggling to pay bills and much higher than the 39% among those not living paycheck to paycheck.
Consumers living paycheck to paycheck without issues paying bills are 47% more likely than those not living paycheck to paycheck to put subscriptions among their first cuts. Across the eight categories compared, subscriptions show the widest gap between those stuggling to pay bills and those not living paycheck to paycheck. Widespread use offers little assurance that a service will survive a tighter budget.
Meals and drinks purchased outside the home are even more exposed among consumers living paycheck to paycheck without issues paying bills. Among those who consider each category discretionary and purchased from it, 76% would cut breakfast or lunch first, as would 72% for coffee or drinks out and 70% for food delivery. (Respondents could identify multiple categories to cut first.)
Consumers agree more on why they would cut discretionary spending than on what they would cut. Among those whose first cut is a discretionary expense, 49% to 54% in each group say it is more of a want than a need. Ease of stopping follows at 43% to 44%.
When Discretionary Purchases Are the Most Protected
Roughly one in five consumers who make discretionary purchases would hold onto at least one for as long as possible.
The expenses consumers would protect the longest are not always those they consider essential. Among consumers who bought from at least one category they consider discretionary, 19% to 20% in every paycheck-to-paycheck group would keep at least one for as long as possible, even those struggling to pay bills.
Grocery delivery or personal shopping leads the eight everyday categories consumers living paycheck to paycheck without issues paying bills would protect. Roughly 12% of its discretionary purchasers would keep it, compared with 10% for clothing and 8% for entertainment among their respective purchasers. Grocery delivery also leads among paycheck-to-paycheck consumers struggling to pay bills, while travel leads among those not living paycheck to paycheck.
Many consumers would cut subscriptions early, yet subscriptions rank among the top three protected discretionary categories for struggling and non-paycheck-to-paycheck consumers. Even within the same financial group, households differ in which services they would keep.
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Methodology
“Keep the House, Cut the Subscription: How Consumers Rank Spending” is the latest edition of The Paycheck-to-Paycheck Report, a PYMNTS Intelligence exclusive series. The report draws on a survey of 2,487 U.S. adult consumers conducted September 16–28, 2026.
Respondents classified 22 spending categories as absolutely essential, a spending choice but necessary or a discretionary choice. They identified household purchases over the previous 12 months and assessed their place in the typical monthly budget. The report compares consumers living paycheck to paycheck and struggling to pay bills, those living paycheck to paycheck without issues paying bills and those not living paycheck to paycheck. Results are weighted to the U.S. adult population by age, gender, education, household income and region. All findings are descriptive and reflect self-reported behavior and preferences.
