As household debt continues to rise, many Americans express growing concerns about their ability to keep pace with financial commitments. A recent survey conducted by Achieve reveals that economic anxiety is surging amid escalating debt burdens, with 28% of respondents reporting an increase in their debt over the past three months. This financial strain is primarily attributed to challenges in meeting daily living expenses, general overspending, and job losses or wage reductions.
The impact of these financial pressures is stark, as 36% of respondents admitted difficulty in making timely monthly debt payments, consistent with the previous quarter's findings. Many attribute this challenge to insufficient income relative to their expenditure, a sentiment echoed by 68% of participants, marking an uptick from previous quarters. Despite low unemployment rates and rising wages, these economic conditions are not uniformly distributed across the population, leaving many unable to cover their monthly expenses without resorting to credit.
A concerning 58% of respondents are using credit cards to manage essential expenses, with a notable 29% carrying these balances for over six months. The survey also highlights a growing anticipation of missed payments, particularly among those with student loans, where 38% foresee a delayed or missed payment in the future. Similarly, essential services like phone and internet bills are also at risk of missed payments.
Despite some financial improvements noted in the past six months, optimism about future finances appears to be waning. Only 40% of participants expect financial betterment in the coming months, a decline from previous expectations. The disconnect between financial improvement and consumer sentiment underscores the pervasive anxiety surrounding debt and financial stability.
The Achieve survey also explores the reasons behind missed payments, with a major reason being insufficient funds, cited by 25% of respondents. Job losses and income reductions further exacerbate the situation, with 10-13% attributing their delinquency to these factors. Forgetfulness also plays a role, as 11% reported simply forgetting to make payments.
Conducted in October 2024, the Achieve survey involved 2,000 U.S. consumers with active accounts across various debt categories, providing a comprehensive overview of the current debt landscape. The findings offer critical insights into consumer financial challenges and highlight the need for strategic interventions to support Americans in achieving a sustainable financial future. The Achieve Center for Consumer Insights aims to continue shedding light on these dynamics, supporting their mission to help individuals navigate towards better financial wellbeing.
