Time and time again, social media platforms drive spending sprees among America’s youth. While rightful blame often points to sophisticated algorithms and seamless, few-click checkout experiences, the lure may also stem from culture – what’s hot right now, and who is promoting it? 

According to a new study conducted online by The Harris Poll on behalf of Intuit Credit Karma among 2,092 U.S. adults ages 18 and older, 48% of Gen Z and 40% of millennials say social media causes them to spend money they do not have. While this might seem like old news, it’s the more recent financial implications this trend may be having on young Americans’ finances that makes it timely. 

A majority of Gen Z (86%) and millennials (77%) are leaving 2024 with financial regrets, and both generations’ top financial regrets include not saving money (36% of Gen Z and 33% of millennials) and overspending (41% of Gen Z and 27% of millennials). 

Aesthetic-fueled spending 

Various fashion and lifestyle trends have emerged and trended on social media this past year, influencing young Americans to open their wallets in pursuit of achieving their preferred aesthetic. According to the study, 69% of Gen Z and 58% of millennial social media users admit that social media trends have influenced them to spend money in 2024, with the top influential trend being “Old Money” – a fashion trend inspired by timeless, high-quality pieces, with less focus on brand logos, including tailored blazers, classic styles, etc – which has influenced 28% of Gen Z and 20% of millennial social media users to spend. 

Here is a full breakdown of the different social media trends and aesthetics that have influenced Gen Z and millennial social media users to spend money: 

Was it worth the hype? 

Social media’s influence on how consumers spend money would not be nearly as powerful without the influencers and celebrities who use these platforms to create content, and more often than not, push products. A majority of Gen Z (79%) and millennial (70%) social media users have made “hype purchases” in the past, and among them, 81% of Gen Z and 80% of millennials say they’ve regretted making such purchases. For the purposes of this study, “hype purchases” are defined as items/experiences that have gained popularity on social media, oftentimes because of an influencer or celebrity, that potentially result in consumers purchasing things they do not actually need. 

Here is a full breakdown of the types of hype purchases made among Gen Z and millennial social media users who have made hype purchases, and those they regret purchasing:

Social media habits in the new year 

As young Americans reflect on their 2024 spending habits, some plan to be more conscientious in the new year as it relates to their use of social media. A majority of Gen Z (90%) and millennials (88%) are planning to implement tactics to create healthier financial habits in 2025, including participating in a personal finance challenge (31% of Gen Z, 29% of millennials) – which often gain popularity on social media – whether that’s committing to shopping significantly less than they did the year prior or taking a more mindful approach to shopping – or going on a social media diet (25% of Gen Z, 17% of millennials), which entails using social media less, or not at all. 

“Credit Karma has conducted several studies this year that emphasize social media’s influence on consumers’ spending behaviors, whether they’re doom spending to cope with their emotions or booking travel after seeing other people’s vacations online,” said Courtney Alev, consumer financial advocate at Credit Karma. “Whatever the temptation may be, many different aspects of social media drive us to spend money, but it’s important to reflect on the purchases we’ve been influenced to make, and ask ourselves whether it was worth it or not. Trends come and go – and these days, at warp speed – so if you’re guilty of chasing down the latest and greatest product, trend or aesthetic, remember that it may have a short shelf life. Will you still get frequent use out of that expensive mob wife inspired leopard print coat next winter, or will you have moved on to a different style after one wear?” 

Methodology

This survey was conducted online within the United States by The Harris Poll on behalf of Credit Karma from November 25-27, 2024, among 2,092 U.S. adults ages 18 and older, among whom 350 are Gen Z ages 18-27 and 707 are Millennials ages 28-43). The sampling precision of Harris online polls is measured by using a Bayesian credible interval.  For this study, the sample data is accurate to within +/- 2.5 percentage points using a 95% confidence level. This credible interval will be wider among subsets of the surveyed population of interest. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact pr@creditkarma.com. 

The new year symbolizes a fresh start, but for the countless Americans heading into 2025 with debt, that might be wishful thinking.

According to a new study conducted online by The Harris Poll on behalf of Intuit Credit Karma among 2,092 U.S. adults ages 18 and older, 70% of Americans have financial regrets from 2024, rising to 86% of Gen Z. The most common financial regret shared among Americans was not saving money (31%) – which was the case for 42% of those with an annual household income (HHI) of less than $50k and 36% of Gen Z – followed by overspending (25%). While 36% of Gen Z regret not saving in 2024, their most common financial regret is overspending (41%).

Admissions of overspending could signal debt troubles. In fact, half of Americans (51%) expect to have credit card debt heading into 2025, with roughly a quarter (24%) expecting to have $5k or more in debt, and roughly one-in-seven (15%) expect to have $10k or more.  

While excessive spending may be a common reason for Americans’ debt troubles, other reasons are likely more out of their control. In 2024, 67% of Americans experienced financial setbacks, including 75% of those with an annual HHI less than $50k, with the most common financial setbacks being unexpected expenses (24%), taking on debt (22%) and their income declined (20%). 

In many instances, women fared worse than men. This year, more than a quarter (27%) of women say a financial setback they faced was unexpected expenses (v. 22% of men), a quarter (25%) of women cite taking on debt (v. 20% of men), 22% of women cite their income declining (v. 17% of men), 22% of women cite not being able to afford necessities (v. 13% of men), 18% of women cite falling behind on payment obligations (v. 12% of men) and 15% of women cite having to deprioritize certain debt payments to accommodate others (v. 9% of men). 

For many Americans, 2024 will leave much to be desired in terms of financial progress. More than half (54%) of Americans say their financial situation worsened in 2024 and 69% had to put off major financial milestones. 

2025 may be the year of financial accountability

Financial progress doesn’t happen overnight, and Americans’ financial journey will vary in the new year. For instance, it might be a shakier start for the roughly one-in-seven (14%) Americans who expect to have $0 in savings heading into the new year, rising to 30% of those with an annual HHI of less than $50k. While the 66% of Americans who say they established money-saving habits in 2024 that they will continue to practice in 2025, might have an easier path forward. 

Regardless, most Americans have hesitations entering the new year. More than three quarters (79%) of Americans say they have financial concerns heading into 2025, the most common being the state of the U.S. economy (e.g. cost of living, inflation) (39%), followed by not being able to save money (35%, 45% for those with annual HHI less than $50k), not having an emergency savings fund (29%, 41% for those with annual HHI less than $50k), and facing unexpected expenses (e.g. medical procedure, car breaking down) (29%). Other financial concerns some Americans have include not having enough money saved for retirement (24%), not being able to climb out of debt (22%) and not being able to afford necessities (21%, 31% for those with annual HHI less than $50k). 

Financial concerns aside, Americans are not losing sight of their financial goals, and healthier financial habits are on many people’s New Year’s resolution lists. In fact, 69% of Americans say they have clearly defined personal finance goals that they plan to achieve in 2025. 

Before consumers build new smart money habits, they’ll look to break the bad ones that did a disservice to their wallets in 2024. Nearly three quarters (73%) of Americans say they are committed to breaking bad financial habits in 2025, the top one being not saving money (34%, 40% of Gen Z), followed by impulse buying (27%, 37% of Gen Z) and not having an emergency fund (26%). 

Out with the old, in with the new. The top tactic Americans plan to practice to create healthier financial habits in 2025 is making a budget and sticking to it (44%), followed by focusing on improving their credit (30%) and finding healthier mechanisms than spending to cope with emotions (23%, 37% of Gen Z). 

“It’s fairly common to enter a new year with financial regrets,” said Courtney Alev, consumer financial advocate at Credit Karma. “Looking back, there’s always going to be better choices we could have made or purchases we didn’t need, but it’s not productive to continuously dwell on the bad: instead, channel those feelings of regret into motivation to commit to better financial habits in the new year. In fact, our study shows that nearly three quarters of Americans are committed to breaking bad financial habits in 2025. What you’ll likely find is that various people in your life share the same motivation for improving their finances. Become accountability partners and make a plan for how you’re going to get your finances back on track.” 

Methodology

This survey was conducted online within the United States by The Harris Poll on behalf of Credit Karma from November 25-27, 2024, among 2,092 U.S. adults ages 18 and older. The sampling precision of Harris online polls is measured by using a Bayesian credible interval.  For this study, the sample data is accurate to within +/- 2.5 percentage points using a 95% confidence level. This credible interval will be wider among subsets of the surveyed population of interest. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact pr@creditkarma.com. 

Elevated stress levels among Americans are putting a damper on their finances as spending money becomes a key coping mechanism. 

According to a study conducted by Qualtrics on behalf of Intuit Credit Karma, 60% of Americans are concerned with the current state of the world and economy, and the top worries among this group include the cost of living (55%), inflation (43%) and the upcoming presidential election (28%). Other worries burdening Americans include unaffordable housing (21%), their wages not keeping up with current costs (21%) and foreign affairs such as wars (14%). 

Of those who are concerned about the current state of the world and economy, 43% say not having enough money to afford necessities like food, clothing and rent/mortgage worries them the most about how they could feel the impact, followed by having their savings depleted (31%), their retirement funds taking a hit (28%) and not being able to spend money on things that bring them happiness (28%). 

Uneasy feelings have festered for the past year with 71% of Americans admitting they are more worried about the state of the world now than they were a year ago, and 61% feel the same about the economy. Uncertainty can take a toll on people’s mental health, perhaps driving unhealthy coping mechanisms. In fact, 63% of Americans say that the current state of the world and economy gives them anxiety about their finances, impacting how 59% of Americans spend their money. 

To cope with stress, more than a quarter (27%) of Americans are doom spending, and 40% say they doom spend more now than they did a year ago. For the purposes of this study, “doom spending” is defined as spending money despite concerns about the economy and foreign affairs. This phenomenon is most common among younger generations (37% of Gen Z and 39% of millennials), validated by their instinct to spend money to cope with their emotions, including anxiety, uncertainty and depression (47% of Gen Z and 42% of millennials). 

Instead of channeling concern into responsible financial management, more than one-third (36%) of Americans say they can’t rationalize saving money due to feelings of uncertainty about the world and economy, increasing to 47% of Gen Z and 43% of millennials. This could be why nearly one-in-five (19%) Americans have $0 in savings right now. Sadly, this has 44% of Americans feeling pessimistic about their financial future, and another 43% have given up on achieving certain financial milestones because they feel too out of reach. The primary financial goals that feel out of reach for Americans, include saving money (42%), paying off debt (26%) and being able to upgrade their living situations (26%). 

Young people are chronically online, and it’s taking a toll on their finances 

More than half (53%) of Americans say they feel like they’re constantly receiving bad news online. Among them, 44% admit to being chronically online, which is the case for a whopping 70% of Gen Z and 52% of millennials. For the purposes of this study, being chronically online entails spending a large amount of time online and prioritizing internet culture over other aspects of life. 

The top reason people spend money to cope with their emotions is because it helps relieve their stress (50%), so it’s no wonder more than half (53%) of Gen Z and 49% of millennials say that receiving bad news online/social media drives them to stress spend. Interestingly, men are twice as likely than women to stress spend when receiving bad news online (48% versus 23%). 

While nearly half (49%) of Americans prioritize being online and on social media in order to stay informed on what is happening in the world, roughly one-third (34%) recognize that they’d spend less money if they cut back on their screen time. That awareness has 67% of Gen Z and 58% of millennials planning to spend less time online/social media to help with their stress levels. 

What will 2025 bring? 

As we gear up for a new presidency, and near the end of the year, Americans have mixed feelings on what to expect when it comes to the economy in 2025. For one-in-10 (10%) Americans, that entails having zero feelings of optimism about next year’s economy. Although, interestingly, some of the things Americans are most and least optimistic for in the new year, overlap. For instance, one in five (20%) Americans are most optimistic about inflation returning to normal, while 14% are least optimistic about it. And, while 11% feel most optimistic about the general economic effects they’ll experience from the upcoming election, 13% are feeling the least optimistic about the impact. 

“It’s been a tumultuous year for many Americans, and with the election right around the corner, politics can often add to people’s stress levels,” said Courtney Alev, consumer financial advocate at Credit Karma. “Time and time again, we see people spending money to cope with their emotions and relieve stress, and while it might result in short-term relief, it can have long-term negative implications on their finances. Young consumers, who spend much of their time online and on social media are especially susceptible to the impact that doom scrolling can have on their wallets. Social media helps people stay informed, but it can also cause undue stress depending on the type of content people consume. Our study found that young Americans plan to make an effort to spend less time online to help with their stress levels, but for those who struggle to cut down on their screen time, it’s important to rely on healthier channels than spending money to relieve stress, whether that be exercise, meditation or taking up a new hobby.” 

Methodology

This survey was conducted online within the United States by Qualtrics on behalf of Intuit Credit Karma between October 25, 2024 and October 29, 2024 among 1,001 adults ages 18 and older. 

The verdict is typically split regarding how people feel during the holiday season. For many, it’s a joyful time with family and friends, but for others, it can feel overwhelming, especially when it comes to money and finances. 

According to a new study conducted by Qualtrics on behalf of Intuit Credit Karma, nearly half of Americans (49%) feel stressed about affording the holidays this year. While the holidays are generally an expensive time, 61% of consumers say that inflation and higher costs have significantly impacted their holiday spending budgets. Yet, interestingly, the latest rate cut from the Fed has Americans feeling more comfortable swiping their credit cards as a quarter (25%) say they will spend more on holiday shopping now that interest rates have dropped (45% of Gen Z, 39% of millennials). Regardless, 44% of people feel pressure to spend more than they can afford this holiday season, climbing to 53% of Gen Z and millennials. 

Some people are so stressed that they wish the holidays were canceled this year because of the cost (29%), which is especially the case for young people (38% of Gen Z and 37% of millennials). These uneasy feelings could stem from the debt hanging over Americans’ heads as they enter an already pricey time of the year. In fact, 43% of consumers have existing debt heading into this holiday season, and a whopping one-third (33%) are carrying upwards of $5,000 in debt. It’s no wonder that nearly half of consumers (49%) feel the most stressed about their finances during the holiday season. 

The season of YOLO spending 

Tis the season of targeted ads and savvy sales tactics making it all too easy to get carried away when holiday shopping. More than a quarter of consumers (27%) say social media drives them to overspend during the holidays – which is especially the case for Gen Z (46%) and millennials (37%) – and 40% say that holiday sales encourage them to spend money they don’t have on things they don’t need. A prime instance of that is the act of “spaving”: spending more to save more, i.e. adding an extra item to an online shopping cart to get free shipping. In fact, 40% of Americans say they are more likely to “spave” while holiday shopping, jumping to 49% of Gen Z and 51% of millennials. 

Not only do consumers feel obligated to buy gifts for other people, but they’re also subject to temptation to buy for themselves. More than one-third of consumers (37%) say they typically spend money on themselves when holiday shopping for others, especially Gen Z and millennials (47%). 

Some people have given up on trying to be fiscally responsible during the holiday season. In fact one-in-five Americans (21%) say they don’t care about making good financial decisions during the holidays, especially young people (37% of Gen Z and 30% of millennials). This is validated by the fact that during the holiday season, some consumers don’t budget (26%), don’t keep track of their spending (20%) and spend what they want, and deal with the consequences later (25%). 

Savvy shoppers practice mindful spending 

The rules of responsible spending go out the window for many consumers during the holiday season, yet others have a system in place to make sure they don’t stretch their wallets too thin. An impressive 28% of people claim they make a budget during the holiday season and always stick to it. In other instances, it’s all about preparation – 44% of Americans say they save money throughout the year in preparation for holiday spending, while roughly one-third (32%) say they shop throughout the year so they don’t spend all at once. And, some go as far to buy gifts on sale/clearance right after the holidays come to a close for next year (19%). Money reasons aside, 58% of consumers are being cautious of overconsumption this holiday season. 

Gifts and groceries drive up balances and deplete savings 

Of the 49% of Americans who plan to take on debt this holiday season, they point to gifts for others (61%), groceries for holiday meals (44%) and necessities like rent and bills (29%) as primary items they’ll go into debt for. 

Those who plan to spend money this holiday season will pay with cash (49%), charge their credit cards (42%), pull from their savings (26%); (34% of Gen Z), use credit card rewards (25%) and pull from a dedicated savings account for holiday spending (14%). And, nearly one-in-six consumers (16%) plan to open a new credit card, whether it be a rewards card or retail card, specifically for holiday shopping, which is the case for 30% of Gen Z and 27% of millennials.  

Sacrifices and compromises will be made 

More than a quarter of Americans (27%) will have to skip holiday traditions this year due to cost, climbing to 35% of Gen Z and 36% of millennials. Of those, more than half (53%) say this is the first year they’ve had to skip a holiday tradition because of money. In an effort to save money on the holidays, nearly one-third of consumers (30%) plan to shop at discount stores, while others plan to make DIY gifts (e.g. baked goods, knitting, art) (20%), have honest conversations with friends and family about what they can afford (19%), coordinate a git exchange that only requires each person to buy one gift (17%), skip exchanging gifts (16%) and shopping second-hand (15%). 

Parents with young children may face challenging conversations around gifting expectations as a quarter of parents (25%) with kids under 18 say they are not giving gifts to their kids this season due to their financial situation. Yet, some are less willing to broach the topic with more than half of parents (55%) saying they’d rather take on debt to buy gifts for their children than tell them they can’t afford them. Others will also take the opportunity to have honest conversations with their kids about money – 56% of parents will set financial boundaries with their kids around gift giving and 51% will use the holidays as an opportunity to teach their kids about money. 

Student loan borrowers face affordability challenges 

Student loan borrowers face an especially challenging holiday season with 46% of borrowers saying they cannot afford the holidays this year because of their student loan payments, while another 45% cannot afford to travel home. Some borrowers will prioritize the holidays over their finances with 47% saying they will pause making payments toward their student loans so they can enjoy the holidays. 

“Time and time again, the holidays are a polarizing time of the year for people, bringing forth a range of emotions from excitement and community to anxiety and loneliness,” said Courtney Alev, consumer financial advocate at Intuit Credit Karma. “Oftentimes, these feelings of unrest stem from money worries — our study found that more than a third of Americans (37%) say the cost of the holidays negatively impacts their mental health. For those who are stressing about the cost of the holidays this year, you’re not alone. Talk to your family and friends about what you can and cannot afford, or consider setting up a gift exchange that only requires each participant to give just one gift. And remember, the true purpose of the holiday season is to spend time with your loved ones, not to exchange gifts.”

Methodology 

This survey was conducted online within the United States by Qualtrics on behalf of Intuit Credit Karma between September 20, 2024 and September 29, 2024 among 2,003 adults ages 18 and older. 

Generation Z has reshaped various societal norms, which entails redefining what’s in and what’s out. The latest workforce trend being embraced by today’s most influential generation is blue-collar career paths. As the promise of a four-year degree falls short, and the cost to receive a college degree continues to climb, young Americans are making blue-collar jobs cool again. 

According to a new study conducted online by The Harris Poll on behalf of Intuit Credit Karma among 2,091 U.S. adults ages 18 and older, nearly half of Americans (49%) believe that American society views trade jobs more negatively than corporate jobs – a belief most pronounced among older generations (61% of baby boomers ages 60-78 and 54% of Gen X ages 44-59 versus 39% of millennials ages 28-43 and 36% of Gen Z ages 18-27). While the stigma associated with trade work – also known as blue-collar – is present, perceptions are starting to shift, and young Americans are leading the charge. 

A majority (78%) of Americans say they’ve noticed a recent growing interest from young adults to pursue trade careers, possibly supported by the fact that roughly one-in-five Americans (21%) view trade jobs more positively than corporate jobs, especially the case for millennials (31%) and Gen Z (23%). In fact, 15% of Americans have considered pursuing vocational training or trade school, and that jumps to 27% of Gen Zers and 16% of those who currently work a corporate job. 

Nearly a third (32%) of employed Americans currently work in the trades, including 38% of Gen Z, 34% of millennials, 30% of Gen X and 28% of Baby Boomers. And nearly a quarter (23%) of Americans who don’t currently do trade work say they plan to get into the profession in the future, which jumps to 50% of Gen Z and 42% of millennials. 

What’s so great about trade work? 

The top factor that influenced trade workers to pursue a trade career is work-life balance (43%), followed by job security and job availability (both 42%). On the note of job security, the advent of AI, specifically generative AI (GenAI), may have more people on alert. With the emergence of AI, 66% of Americans believe trade professionals have more job security than corporate professionals – a belief commonly held by both trade workers (71%) and corporate ones (70%). 

Social media might also play a role in the resurgence of interest in trade jobs. One in 10 (10%) trade workers say that seeing skilled-trade workers on social media influenced their decision to pursue a trade career, and another one in 10 say seeing stories on social media from people with corporate jobs who are struggling to make ends meet also impacted their decision. 

The promise of a 4-year degree is broken 

It’s difficult to imagine a resurgence in blue-collar work without the acknowledgement of the fraught nature of the higher education system in the United States, which has many people wondering if the expense is worth it. Nearly half of Americans (45%) don’t see the value in a 4-year college degree, and that remains true for more than half of Gen Z (52%). In a similar vein, a majority of Americans (64%) do not think taking on student loan debt is worth the return on investment of a college education, and more than three-quarters of Americans (77%) think the argument that you need to go to college to have a successful career is outdated. 

While more than 3 in 5 Americans (61%) are under the impression that in most cases, getting a college degree will result in a well-paying job, 22% of those who went to a 4-year college are not making as much money as they thought they would, having attended one. The latter is felt among nearly a quarter (23%) of corporate workers. 

The crippling nature of student loan debt is likely why more than half (54%) of those who currently have student loans, or have had them in the past, regret their decision to take on debt for a degree. Luckily, only 12% of Americans who attend a 4-year college, or attended one in the past, are dissatisfied with their decision to do so, yet, that increases to roughly one-in-five (21%) Gen Zers. 

Stigmas drive unawareness 

Over time, four-year universities have been idolized as the true path to success, especially among highly educated parents who expect their kids to follow in their footsteps. This could be why trade school and vocational training programs have an awareness problem in the U.S. Of those who attended or are currently attending a 4-year college, 19% were not aware there were alternative education paths they could have taken for school/career, and that jumps to 33% of Gen Z and 29% of millennials. And, roughly one in 11 (9%) say they were forced by their parents to attend a 4-year college, which is the case for 15% of Gen Z and 12% of millennials. Interestingly, 16% of trade workers also say they were forced by their parents to attend a 4-year college, which could be a hard pill for them to swallow if they had to take on debt to do so. 

Entrepreneurship flourishes in trades 

Stigmas aside, most Americans are aware of the entrepreneurial opportunities that exist for blue-collar workers. Roughly three quarters (76%) of Americans believe trade professionals have a better chance at becoming a business owner/entrepreneur than corporate professionals – and they’re not wrong. Trade workers (20%) are almost twice as likely as corporate workers (11%) to be self-employed. And the pay is not half bad either – 30% of trade workers make $100k+ in annual gross income. 

One is not superior to the other 

We’re seeing a split mindset when it comes to how Americans view a four-year college education and the overall return on investment (ROI). Exactly half of Americans (50%) agree there is a higher ROI (i.e. career earnings compared to education cost) with a 4-year college than with a trade school, while another half disagree with this claim.

“Lately, there’s been a lot of warranted attention placed on the exorbitant cost associated with getting a four-year college degree, and healthy debate as to whether the return on investment is worth the expense,” said Courtney Alev, consumer financial advocate at Credit Karma. “The traditional four-year college path isn’t one-size-fits-all, and vocational and trade schools may offer an affordable path to well-paying, skilled trade jobs. It’s refreshing to see young adults taking notice and interest in these lines of work, especially considering how challenging it’s been for new grads to find white collar jobs. Whatever decisions consumers make about their education and career paths, they can rest easy knowing plenty of corporate and trade professionals alike are happy in their jobs. Our study found that a majority of trade workers (81%) and corporate workers (74%) say that if they were to re-enter the job market, they would still choose to pursue the same career path.”

Methodology

This survey was conducted online within the United States by The Harris Poll on behalf of Credit Karma from August 1-5, 2024 among 2,091 U.S. adults ages 18 and older. The sampling precision of Harris online polls is measured by using a Bayesian credible interval.  For this study, the sample data is accurate to within +/- 2.5 percentage points using a 95% confidence level. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact pr@creditkarma.com. 

Student loan debt continues to be a sore spot for many Americans struggling to make their monthly payments, while many borrowers hold their breath in hopes that loan forgiveness is in their future. 

According to a new study conducted by Qualtrics on behalf of Intuit Credit Karma, one-in-five (20%) student loan borrowers admit to not having made any payments toward their student loans, which is the case for 27% of borrowers with less than $50K in household income (HHI). The decision to not make payments likely stems from affordability issues as nearly half (49%) of student loan borrowers feel financially unstable right now, and more than half (55%) say they are unable to afford their student loan payments. Low-income borrowers are being hit especially hard – 65% of those with less than $50K in HHI say they cannot afford their student loan payments. 

Many borrowers grappling with affordability challenges blame the cost of living with 69% saying that the high cost of living has made it difficult for them to afford their payments. Borrowers are having to make tradeoffs when it comes to paying down debt, and it’s negatively impacting their ability to make financial progress. 38% of student loan borrowers say they’ve fallen behind on other bills (e.g. auto loan, mortgage, credit card) in order to make payments toward their student loans, while another 39% are forgoing making payments toward their student loans to pay down other high-interest debt. 

Perhaps even more concerning is the 38% of borrowers who say they’ve depleted their savings to pay their student loans, increasing to 44% of Gen Z and 41% of millennial borrowers. As a likely result, about one-third (34%) of student loan borrowers say they have $0 in savings, which is the case for 55% of borrowers with less than $50K in HHI. 

Being able to make payments toward their student loans comes at a cost for many borrowers who have had to make sacrifices and lifestyle adjustments to do so. In order to afford their student loan payments, borrowers have decreased their non-essential spending (37%), taken on additional work to increase their income (31%), sacrificed necessities like groceries, rent and bills (26%), applied for an income-driven repayment plan (IDR) or other government programs to lower their monthly payments (24%), dipped into their emergency savings (23%) and put off key financial milestones like buying a home or having children (21%). 

Will the SAVE plan be saved? 

Of the 82% of borrowers with federal student loans, about half (48%) are aware of the Biden administration’s Saving on a Valuable Education (SAVE) plan, a government provided assistance plan for federal borrowers who qualify. Of the nearly half of federal borrowers who have the SAVE plan on their radar, 63% have applied for the plan, and a whopping 82% of those who applied, qualified. 

However, the fate of the SAVE plan remains in limbo and it hasn’t been the easiest situation to follow. As shown by the 68% of student loan borrowers who say the court updates regarding the SAVE plan have been confusing to follow. Uncertainty aside, roughly three-quarters (76%) of student loan borrowers are hopeful the SAVE plan will be implemented. However, in this case, hopefulness could come at a cost. More than one-third (36%) of student loan borrowers say they are not making consistent on-time payments toward their loans in hopes that their debt will be forgiven. 

For some borrowers, the SAVE plan is irrelevant, and perhaps a bit of a tease. 40% of student loan borrowers say they make too much money to qualify for the SAVE plan but not enough to afford their student loan payments. 

Credit score busts could be in the cards for federal borrowers 

As we near the one-year anniversary of the end of the pandemic-enacted forbearance put in place for federal student loan borrowers, those who haven’t been making payments should be on high alert. That’s because the Department of Education enacted a 12-month “on-ramp” to repayment period that expires on September 30th, 2024. This protects federal student loan borrowers from having a delinquency reported to the credit reporting agencies and prevents the worst consequences of missed, late, or partial payments.

More than one-third (37%) of federal student loan borrowers say they are aware of this program, and 63% of those who have not been making consistent on-time payments toward their federal student loans are worried that their credit score will take a hit once their student loan payment history is reported to the credit bureaus this October. That’s because interest still accrues during the on-ramp period, so balances will have swelled for those not making payments. In fact, 69% of borrowers who have not been making consistent on-time payments toward their student loans say they will not be able to afford to pay down the interest they’ve accrued from missing their student loan payments.

You could argue that some borrowers took irresponsible advantage of the “on-ramp” protection. Roughly one-in-seven (15%) of those who have not been making consistent on-time payments toward their federal student loans purposely weren’t doing so because they knew their credit score would not be impacted. This jumps to 38% of Gen Z federal student loan borrowers. 

Student loan debt brings affordability challenges to Americans of every age, and 60% of student loan borrowers say their loans are preventing them from reaching their savings goals, or from paying off debt. That could be why borrowers are questioning the value of a college degree, with about one-third (34%) of borrowers admitting that they don’t think the return on investment for higher education in America is worth the expense. 

“Student loan debt continues to stand in the way of many Americans’ ability to reach their financial goals, whether they’re fresh out of college or approaching retirement,” said Courtney Alev, consumer financial advocate at Intuit Credit karma. “And, with Biden’s SAVE plan in limbo, many borrowers face uncertainty as to whether or not they will benefit from lower monthly payments and a clear path to loan forgiveness. We know from our study that one-in-five borrowers have made zero payments toward their student loans, which means their balances have been growing, especially now that interest has accrued for nearly a year now. These borrowers could find themselves in an unruly amount of debt. While it’s great to have hope in potential loan forgiveness, borrowers should not put all their eggs in that basket. Those struggling to make their student loan payments should reach out to their loan servicer to understand their options, whether that be forbearance, deferment or a more affordable repayment plan.” 

Methodology

This survey was conducted online within the United States by Qualtrics on behalf of Intuit Credit Karma between August 3, 2024 and August 19, 2024 among 1,995 adults ages 18 and older with outstanding student loan debt. 

The rent vs buy discourse typically centers around the home, often hitting on affordability and what’s considered to be the better financial investment. However, over time we’ve seen renting permeate into other aspects of our lives. Today, you can rent everything from clothes and furniture to cars and sporting equipment – and plenty of people find value in doing so. While money and affordability might be motivating factors, in many cases, renting is a lifestyle choice. 

According to a new study conducted online by The Harris Poll on behalf of Intuit Credit Karma among 2,042 U.S. adults ages 18 and older, more than 1 in 4 Americans (28%) rent or lease goods/services, whether that be their car (17%), clothing or accessories (9%), electronics (8%), furniture (7%), etc. When factoring in housing, the percentage of American renters/leasers jumps to 47%. 

Owning isn’t all it’s cracked up to be for many Americans who rent/lease goods or services. Of those, 58% say they live a rent-first lifestyle, defined as choosing to rent as a personal choice and not because of outside pressures or affordability reasons. What’s driving the decision to rent/lease? The top reason comes down to the flexibility that renting allows (35%), followed by being better able to save money (31%), wanting to try things out first before deciding whether to make a purchase (27%), and to better avoid overconsumption (e.g. buying too many things, spending too much money, wasting) (21%). 

Whatever peoples’ reasons are for choosing to rent over buy, nearly 3 in 5 Americans who rent/lease goods or services (58%) say they find more value in renting than they do buying for most applicable things in their lives, and 64% don’t subscribe to the notion that renting translates to throwing away money. 

Leasing fulfills some car connoisseurs’ dreams 

For some, a car is a means to an end, while others care a lot about the car they drive. Roughly 1 in 6 Americans (17%) lease a car, and among them, 42% do so in order to get a new car every few years. To make sure they’re investing in the best car for them, a quarter of those who lease a car (25%) say they do so they can test out the car they’re considering buying to ensure they like it. And, for car buffs who don’t want to break the bank, 18% say it’s because leasing allows them to drive a luxury car they cannot afford to purchase. 

Peoples’ decision to lease also stems from more practical reasons, which makes sense when you consider a car is often one of many Americans’ most costly assets. Nearly one third (32%) of car leasers say they do so to save money on repairs and maintenance, while 26% say they do so because they don’t want the stress that comes with having to manage repairs and maintenance (e.g. finding a repair shop). More than a quarter (28%) choose to lease their car because they believe that leasing is the more affordable option, while 1 in 9 (11%) don’t think buying a car is a good investment. 

Temporary finds let fashionistas shine

Of those who rent clothes and/or accessories, more than 2 in 5 (41%) do so because they believe it’s the more affordable option. Although money aside, renting fashion merchandise has its upside for fashion-forward consumers – and why many are choosing to rent these items – including the ability to experiment with different styles (35%), wearing luxury items that they otherwise could not afford to buy (34%) and being better positioned to keep up with fashion trends (22%). 

Renting also appeals to people who practice a “less is more” lifestyle, including those who are environmentally conscious. The belief that renting clothes and/or accessories is more sustainable than buying new ones is a reason why 29% rent those items, and the same proportion say they rent because they typically only wear an item a few times. Ultimately, doing so supports more than a quarter of peoples’ minimalist lifestyle – 26% who say they rent in order to have less clutter and more closet space. 

Renting a home has more to do with affordability than flexibility

It may not come as a surprise that the number one reason Americans who rent their homes do so is because they cannot afford to buy (48%), followed by roughly a quarter (24%) who say it’s because mortgage rates are too high to make buying worthwhile. In fact, the housing affordability crisis has gotten so dire that half of Americans who rent/lease goods or services (50%) believe homeownership is only achievable for the wealthy. 

Other money-related reasons Americans who choose to rent their homes do so stem from their belief that they’re saving money by renting (16%), while more than 1 in 7 (15%) say it’s because renting allows them to spend money on other things they care about more, such as travel, shopping and dining out. Others just cannot justify the cost that comes with buying and maintaining a home (16%), and about 1 in 8 (13%) believe that buying a home doesn’t make as much financial sense as it used to. 

In some cases, people just don’t want the added stress or responsibility that comes with owning a home, especially if they’re unsure about where they want to lay down roots. One in five (20%) home renters say they choose to rent because they feel less stressed renting, while others do so because they don’t want the responsibility of maintaining a home, or they don’t plan to be in their area long term (both 18%). 

Renters ditch the status quo 

No matter what drives people to subscribe to a rent-first lifestyle, 3 in 5 Americans who say they rent/lease goods or services (60%) think the belief that buying is always better than renting is outdated. 

“Over the last decade we’ve seen the ‘rental economy’ gain popularity as more opportunities to rent goods and services have flooded the market, offering consumers short-term access to a plethora of items such as clothes, cars, furniture, appliances, electronics and so on,” said Courtney Alev, consumer financial advocate at Credit Karma. “Renting can serve various needs for consumers, whether they’re seeking flexibility, minimalism or savings. That’s not to diminish the current housing affordability crisis that’s standing in the way of many renters’ ability to achieve homeownership. Whatever the case may be, before fully embracing a rent-first lifestyle, consumers should evaluate all of their options to see how they stack up to their goals and aspirations. For instance, if their top priority is to save to buy a home, but they also lease a luxury vehicle and pay a monthly clothing subscription service, they may want to crunch the numbers to make sure they’re on the best path forward to saving for a home.” 

Methodology

This survey was conducted online within the United States by The Harris Poll on behalf of Credit Karma from June 18-21, 2024 among 2,042 U.S. adults ages 18 and older, among whom 979 rent or lease goods/services or a home and 535 rent or lease goods/services not including a home. The sampling precision of Harris online polls is measured by using a Bayesian credible interval.  For this study, the sample data is accurate to within +/- 2.5 percentage points using a 95% confidence level. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact pr@creditkarma.com. 

It’s back-to-school season and parents are bracing for financial impact as they begin shopping for their kids’ upcoming school year. With kids heading back to school later this month, some parents may feel relief as many faced high summer childcare costs, yet, the school year comes with its own set of expenses, and it’s sure to leave some parents in the red. 

According to a new study conducted by Qualtrics on behalf of Intuit Credit Karma, 59% of parents with children under the age of 18 say that due to the high cost of living, they will spend more money on back to school shopping this year compared to previous years. Higher costs create affordability challenges for nearly one-third (31%) of parents who say they are unable to afford back-to-school shopping for their children this year, which is especially true for young parents – 39% of Gen Z and 37% of millennials, compared to 28% of Gen X and 18% of Boomers. 

Affordability challenges aside, parents are willing to go to great lengths to ensure their kids are set up well for the school year. Half (50%) of parents say they plan to sacrifice necessities, such as groceries and bills, to ensure their kids have what they need for the school year, and that jumps to 60% and 56% for Gen Z and millennial parents, respectively. 

Debt turns to dread 

A whopping 44% of parents are dreading back-to-school shopping this year. Feelings of dread likely stem from the many parents who expect to be in the red after back-to-school shopping – and young parents will be spread more thin. More than one-third (34%) of parents plan to take on debt, such as credit card debt or buy now, pay later loans, to pay for school supplies. This increases to 44% and 38% when accounting for Gen Z and millennial parents. 

What’s on shopping lists this school season? Parents plan to spend the most money on clothing and accessories for their kids (44%), followed by groceries and food (17%), school supplies (16%), electronic devices (8%) and after-school programs (8%). Speaking of – after-school programs, such as sports and clubs come with their own price tags, setting parents back even further. One-third (33%) of parents expect to take on debt to cover after-school programs for their kids, rising to 44% of Gen Z and 37% of millennial parents. 

How much debt are parents willing to take on to pay for back-to-school expenses? Nearly one-third (31%) of parents are willing to take on up to $500 in debt, while more than one-in-six (18%) are willing to take on up to $750 in debt, and another one-in-six (16%) are willing to reach $1,000. In more extreme cases, roughly one-in-eight (12%) of parents are willing to take on $1,001 to $2,000 in debt, and 4% plan to surpass $2,000. 

Nearly one-third (30%) of parents do not have any money saved for back-to-school expenses, which could be why debt is in the cards for so many. 

Parents get crafty 

To soften the financial blow, parents are turning to sales and second-hand shopping for their kids’ back-to-school needs. More than half (53%) of parents said they planned to shop Amazon Prime Day sales (July 16-17) for their kids’ school supplies, 61% plan to shop at discount stores, such as Dollar Tree or Dollar General, and one-third (33%) of parents will rely on hand-me-downs and/or borrowed items. 

Parents make sacrifices for their kids’ education 

More than a quarter (27%) of parents with kids in school pay for their children’s education, including private school or tutoring, and that number jumps to 45% for Gen Z parents. Among parents who pay for their children’s education, more than one-third (37%) say they are willing to sacrifice their savings for their children’s education and 20% are willing to sacrifice their retirement savings. Beyond financial sacrifices, parents say they’re willing to sacrifice dining out (51%), going on vacations (47%) and living in an ideal neighborhood (19%). 

“Education costs are primarily spotlighted at the college and post-college levels, yet parents are on the hook for school-related expenses as early as pre-K” said Courtney Alev, consumer financial advocate at Credit Karma. “Many parents with young children are likely entering the school year already stretched thin after covering costs for summer childcare, which could be why many parents expect to be in the red after back-to-school shopping this year. If possible, it’s best to avoid taking on high interest debt to pay for back-to-school expenses, especially if you can’t afford to pay it back right away. Luckily, many parents plan to shop sales and lean on family and friends for hand-me-down items, and several states offer tax-free weekends and back-to-school tax holidays that allow parents to shop for select items free of their state’s sales tax, for a select period of time — care.com provides a helpful guide. And, if your child needs access to more costly items such as a laptop, there are organizations and programs that provide free access – StandUp Wireless has a helpful blog post outlining such resources.” 

Methodology 

This survey was conducted online within the United States by Qualtrics on behalf of Intuit Credit Karma between July 19, 2024 and July 28, 2024 among 1,002 adults ages 18 and older. 

Social media platforms like TikTok and Instagram have become some of the most popular destinations to shop online – even driving some people to take up shopping addictions. While the power of targeted ads, product virality and influencer marketing has influenced many consumers to overspend, in other cases, it’s leaving online shopping baskets empty. 

According to a new study conducted online by The Harris Poll on behalf of Intuit Credit Karma among 2,042 U.S. adults ages 18 and older, nearly 2 in 5 Americans (38%) have purchased products advertised on social media in the past year; among them, nearly a quarter (23%) have charged $1,000 or more to credit when making such purchases, whether using a credit card or buy now, pay later service. 

While plenty of American consumers have succumbed to shopping temptations that social media platforms pose via targeted ads and influencer promotions, in some cases, it can have the opposite effect. Nearly three quarters (69%) of American social media users say they’ve been de-influenced, defined as specifically having chosen not to purchase items advertised on social media. The top reason consumers have intentionally chosen not to make purchases on social media is because they don’t trust influencers on social media who push products (32%). This holds true when looking at millennials (28%, ages 28-43), Gen X (34%, ages 44-59) and baby boomers (38%, ages 60-78) social media users, but it goes a bit deeper for Gen Z. 

A majority (88%) of Gen Z social media users say they’ve been de-influenced, and the top reason for this is unhealthy levels of overconsumption that social media product promotions drive (38%). This adds up considering Gen Z has made a name for themselves as the most eco-conscious generation to date. On that note, a vast majority (90%) of Gen Z Americans say they’ve shopped second-hand, with motivating reasons being to play a part in fighting fast fashion (22%) and wanting to be environmentally conscious (28%). 

Here is a the full breakdown of why different generations of social media users have been de-influenced to purchase items on social media: 

“American consumers being ‘de-influenced’ to purchase items they see on places like TikTok and Instagram shows the level of nuance that exists in the social media space, particularly as it relates to consumer behaviors driven by these platforms,” said Courtney Alev, consumer financial advocate at Credit Karma. “In many cases, social media can be a catalyst for poor financial habits or feelings of inadequacy, while in other cases, it can spur healthy financial trends and a sense of community. Regardless, these social media platforms do a very good job at driving consumers to overspend when scrolling their apps, especially considering how easy it is to purchase something in just a few clicks. If your credit card details are saved online, you might consider deleting stored card information in your apps and browser to make shopping online less frictionless.”

Methodology

This survey was conducted online within the United States by The Harris Poll on behalf of Credit Karma from June 18-21, 2024 among 2,042 U.S. adults ages 18 and older. The sampling precision of Harris online polls is measured by using a Bayesian credible interval.  For this study, the sample data is accurate to within +/- 2.5 percentage points using a 95% confidence level. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact pr@creditkarma.com. 

Summertime and the livin’ is easy – the motto of America’s youth. But for parents of young children, the summertime is anything but easy. As kids ditch early morning wakeup calls and homework assignments for playdates and time in the sun, parents are on the hook for keeping them entertained and cared for, which often comes at a high price tag. 

According to a new study conducted by Qualtrics on behalf of Intuit Credit Karma, 61% of parents with children under the age of 18 say it feels even more expensive to raise kids during the summer months, largely stemming from the cost of childcare. For 40% of parents, summer care isn’t even on the table due to the cost of living, making it so they cannot afford to enroll their children in summer programs and activities. 

This has many working parents making trade-offs when it comes to their careers, with more than one-third (35%) of parents saying they’ll have to adjust their summer work hours to care for their children because the cost of childcare is too expensive. For the 37% of parents lucky enough to have a support system nearby, they’ll depend on their family and friends to help them with childcare this summer. 

Of parents who are enrolling their children in summer programs, 28% plan to take on debt to cover the costs, whether they carry a balance on their credit card or use a buy now, pay later service. That’s realistic when you consider some parents, especially those with more than one child, could be adding thousands of dollars to their summer budgets. Of the 58% of parents who say they will be paying for their kids’ summer programs, nearly a quarter (23%) expect to pay more than $1,000 each month, per child, and 6% are facing monthly bills above $2,000. 

Regardless of parents’ plans for their children this summer, saving money is off the table for 29% of those who will not be able to contribute to their savings nest due to childcare costs, and this comes at a time when 40% of Americans don’t feel financially stable. Ultimately, many parents may not experience these next few months with the same fondness as their children given 40% say they stress the most about their finances during the summer. 

“For years now, American households have been grappling with rising prices for everyday essentials like food, gas and housing,” said Courtney Alev, consumer financial advocate at Credit Karma. “At the same time, parents have been juggling steep increases in childcare costs, which has put a strain on monthly household budgets, especially of those with young children. The summer months can bring an added layer of stress as kids are out of school and parents have to figure out new childcare coverage, which can often lead to one parent sacrificing their career because the economics may not make sense otherwise. This likely impacts working women at a disproportionate rate, as they tend to carry a bulk of child care responsibilities. For those struggling to afford adequate childcare for your children, you can try visiting childcare.gov to learn about potential state resources that can help you pay for the care you need.”

Methodology

This survey was conducted online within the United States by Qualtrics on behalf of Intuit Credit Karma between June 6, 2024 and June 8, 2024 among 2,006 adults ages 18 and older.

High costs – whether it be for airfare or entertainment – are not enough to keep young Americans from living their best lives this summer. With travel at the top of consumers’ to-do lists, financial goals and saving money may be put on pause until the fall. 

According to a new study conducted by Qualtrics on behalf of Intuit Credit Karma, despite the fact that one-third of Gen Z (33%) and 38% of millennials don’t feel financially stable right now, more than one-third of Gen Z (38%) and millennials (35%) are willing to put their financial goals on hold in order to have a fun summer. 

Needless to say, many young Americans are prioritizing fun over their finances these next few months, with roughly one-third of Gen Z (34%) and millennials (32%) reporting they plan to spend money to treat themselves this summer even though they cannot afford to, while 33% of Gen Z and 32% of millennials admit to caring more about having a fun summer than they do saving money. That YOLO energy may play a part in young Americans’ willingness to take on debt in order to afford summer fun (27% of Gen Z, 28% of millennials). 

As temperatures rise, apparently consumer spending does too – at least that’s the case for  

39% of Gen Z and 35% of millennials who say they plan to spend more money this summer than they did last summer. Of those who anticipate their spending will increase over these next three months, 22% of Gen Z and millennials expect to spend up to an additional $1,500 each month, and 13% expect to spend up to an additional $2,000 each month. 

A summer debt hangover may be in the cards for the 20% of Gen Z and 24% of millennials who anticipate taking on debt this summer, with roughly a quarter expecting to take on as much as $2,000 in debt (23% of Gen Z, 25% of millennials). More concerningly is the 11% of Gen Z and 8% of millennials who are forecasting their summer debt loads will surpass $4,000. 

Add summer travel to the tab 

Rising travel prices may not be enough to hold young consumers back from jet setting this summer. Nearly 40% of Gen Z (38%) and millennials (39%) say that regardless of where their finances stand, they will always prioritize summer travel, while 44% of Gen Z and millennials are willing to spend more money on travel this year than in years past. 

Summer travel is officially on the calendar for 61% of Gen Z and millennials, and many are dipping into their savings to cover travel expenses. While 47% of Gen Z and 43% of millennials will tap their general savings to pay for their travel, about a quarter of Gen Z (26%) and nearly one-in-five millennials (19%) plan to use a dedicated savings account they’ve built specifically for travel. 

Gen Z and millennials will also rely on credit card rewards and travel miles to help pay their way (21% of Gen Z, 23% millennials), and 13% of Gen Z respondents plan to open a new travel or rewards card. Additionally, Buy Now, Pay Later services are being considered by 16% of Gen Z and millennials, and 15% of Gen Z and 17% of millennials plan to take on debt to fund their travel. 

Social media spurs travel itineraries  

Social media’s influencing powers strike again, and it’s giving young consumers the travel bug. About a quarter of Gen Z (26%) and 22% of millennials admit to having been influenced to spend money they don’t have on travel from seeing other people’s vacations on social media. Some young consumers are treating social media platforms like their own personal travel agents with 40% of Gen Z and 35% of millennials saying that social media has influenced the type of summer vacation they want to go on, whether it be destinations they want to travel to or specific resorts they want to stay at. 

Social media has also been known to exacerbate pressures to keep up with the Joneses, which could be why 44% of Gen Z and 42% of millennials are more interested in taking a luxury vacation this year than they have been in the past. 

Friendfluence is also a thing 

Social media posts aren’t the only things influencing young consumers to spend money. More than a quarter of Gen Z (28%) and 21% of millennials say they feel like they need to keep up with their friends’ spending habits this summer. In relation to feeling pressure to keep up with friends, and potentially their milestone moments, 36% of millennials and 30% of Gen Z say they feel obligated to attend wedding or wedding-related events (i.e. bachelorette) even if they cannot afford to. 

“Seasonal spending is very real, and summertime is no exception,” said Courtney Alev, consumer financial advocate at Credit Karma. “Despite the fact that many consumers are struggling to keep up with their finances at a time when travel costs are on the rise, many young people aren’t willing to put a price tag on the fun and adventure they seek out during the summer months. Factor in social media, and temptation to spend money grows even more as many of our social media feeds are flooded with people on lavish trips. Whatever your desired summer splurge – whether it’s taking a vacation, going to the concert, or buying new clothes for the summer – do your best to plan ahead, save up for the purchase, and stick to a budget. Going into debt for fun is never recommended, especially with sky-high credit card interest rates, but if you find yourself spending more than you can immediately afford to pay off, make sure you have a plan to pay down that debt ASAP before interest charges rack up.”

Methodology 

This survey was conducted online within the United States by Qualtrics on behalf of Intuit Credit Karma between June 6, 2024 and June 8, 2024 among 2,006 adults ages 18 and older.

Food inflation has proven to be sticky over the past few years with grocery prices up 25% since the start of the pandemic. As Americans walk the grocery aisles for household staples, they’re reminded that their money doesn’t go as far as it once did. Luckily, there are some glimmers of cost relief on the horizon. New inflation data from the US Department of Labor shows that for the first time in a year, grocery prices dropped in April. This will hopefully help lessen the financial strain for the American households that have been priced out of basic necessities. 

According to a new study conducted by Qualtrics on behalf of Intuit Credit Karma, 44% of Americans report feeling financially unstable, which is especially the case for those with household incomes (HHI) of less than $50K (56%). Feelings of financial instability likely stem from the rising cost of living that has caused more than half of Americans (55%) to take on debt. 

A majority of consumers (80%) say they’ve noticed the most notable increase in cost when shopping for groceries, followed by gasoline (51%), bills (i.e. cable, electricity, internet) (39%), housing and dining out (both 27%).

As consumers grapple with high grocery costs, many have changed their shopping habits by starting to shop at discount stores for their groceries (37%), while others have had to make tradeoffs that could take a toll on their health. Roughly a quarter of respondents (26%) have resorted to buying unhealthy food for themselves and their families because it’s all they can afford. The inability to afford groceries could also be impacting people’s mental health, as 21% of respondents report feeling ashamed about their inability to afford groceries. 

A change in shopping habits isn’t going to cut it for everyone, with some consumers going to great lengths to put food on the table. This is the case for 28% of those who are sacrificing other necessities (e.g. rent, bills) to afford groceries, while more than a quarter (27%) admit to occasionally skipping meals. Another 18% have applied for, or have considered applying for food stamps, and 15% rely on, or have considered relying on food banks for their groceries. 

People having to sacrifice necessities in order to afford groceries isn’t entirely shocking when you consider about one-third of Americans (32%) say they are spending more than 60% of their monthly income on essential expenses like bills, rent and groceries, and another 21% are spending 46% to 60% of their monthly income on essentials. Zooming out, many Americans find themselves in a tough predicament with more than half (53%) saying they earn too much money to qualify for government assistance (i.e food stamps), but not enough to afford necessities. 

“Food insecurity is a major issue in this country as millions of Americans don’t have enough food to eat or don’t have access to healthy food,” said Courtney Alev, consumer financial advocate at Credit Karma. “Over these past few years, a rise in costs for food and household staples have put American households in precarious situations, especially low-earning households who have families to feed. While we’re seeing early signs of inflation relief for food, Americans are still facing rising costs for other necessities such as rent and gasoline, which could be counteracting their journey toward financial stability. For those struggling to feed themselves or their families, your local food bank may be able to help. You can visit feedingamerica.org and enter your zip code to find food banks in your community.” 

Methodology

This survey was conducted online within the United States by Qualtrics on behalf of Intuit Credit Karma on May 7 to May 13, 2024 among 2,011 adults ages 18 and above.