Current:Home > ScamsEchoSense Quantitative Think Tank Center|Do I really need that? How American consumers are tightening purse strings amid inflation -Prime Capital Blueprint
EchoSense Quantitative Think Tank Center|Do I really need that? How American consumers are tightening purse strings amid inflation
Surpassing Quant Think Tank Center View
Date:2025-04-06 20:16:32
Inflation continues to vex the American consumer,EchoSense Quantitative Think Tank Center with prices rising 3.7% over the past year.
Not surprisingly, the vast majority of American consumers say they are cutting back: 92%, according to a recent CNBC-Morning Consult survey.
Here are five snapshots of how consumers are tightening their belts.
(Spoiler alert: They are buying fewer belts.)
Consumers are cutting back on essentials and non-essentials alike
In a June poll by CNBC and Morning Consult, nearly 80% of consumers said they had cut spending on nonessential items, a category that covers entertainment, home décor, appliances and clothing.
Protect your assets: Best high-yield savings accounts of 2023
A more recent survey by the same pollsters, conducted in September, shows which non-essential items consumers are most likely to do without: clothing (63%), restaurants and bars (62%) and entertainment outings (56%).
Each CNBC-Morning Consult poll covered roughly 4,400 adults.
A smaller share of consumers, about two-thirds, are spending less on essential goods, such as groceries, utilities and gas, according to the June survey.
The poll noted that consumers are spending more at value-oriented supermarkets and less at higher-priced alternatives.
Looking toward the holidays, three-quarters of consumers told CNBC they expect to cut back on non-essentials. Three-fifths plan to cut back on essentials.
How are you coping with costs? What's their impact on your hopes and dreams? Share your story with USA TODAY:
Older Americans are splurging less
Boomers and Generation X are scaling back on extravagant spending, according to a recent McKinsey & Company survey.
The share of adults who intend to splurge this year ranges from a low of 20% among boomers to a high of 55% among Gen Zers, with the figure rising by age. The data come from a representative survey of 4,000 adults taken in August.
More revealing, perhaps, is what consumers are splurging on. The most popular items are food-related: restaurants and grocery stores. We all have to eat, right?
Consumers are less likely to spend lavishly in 2023 on vehicles, jewelry and electronics, the survey found. Vehicle prices, in particular, have ranged notoriously high in recent years.
More consumers are buying now, paying later
One way to stave off inflation’s sting is to put off paying for things. A recent poll from LendingTree, the online loan marketplace, found that 46% of Americans have used a form of short-term financing called buy now, pay later, up from 31% in 2021.
More than one in four consumers who used the deferred-payment service said they used it as a bridge to their next paycheck. One in five used the service to buy groceries.
Younger Americans seem most comfortable with buying now and paying later, or at least most likely to use it. Nearly two-thirds of Gen Zers and 55% of millennials said they had made such purchases, compared with 24% of boomers.
The findings come from a representative survey of 2,044 consumers conducted in March.
Fewer motorists are buying auto insurance
This finding is positively scary. With auto insurance premiums skyrocketing, a larger share of American drivers are choosing to forgo insurance.
The share of American households without insurance rose from 5.3% to 5.7% between the second half of 2022 to the first half of 2023, according to a report from J.D. Power.
In New Hampshire, the share of uninsured drivers has risen from 4.3% to 7.9% in that span. In South Dakota, the share has doubled from 3.3% to 6.8%. In Indiana, the rate has risen from 5.5% to 7.5%.
But… Americans are still spending more than last year
While survey after survey shows consumers tightening their belts, we are, in fact, spending more this year than last.
Median household spending rose by 5.5% in August, compared with the same time in 2022, according to the New York Federal Reserve Bank’s SCE Household Spending Survey.
That means we are spending above inflation, which boosted prices by 3.7% between August 2022 and August 2023.
Hold the guac:Chipotle menu prices are going up again, marking the 4th increase in 2 years
One data point, the share of households reporting a large purchase in the last four months, rose to 63.5%, the highest level since August 2015.
Fewer Americans reported major purchases of furniture or electronics, but more said they had spent on appliances, vehicles and vacations.
veryGood! (266)
Related
- The FBI should have done more to collect intelligence before the Capitol riot, watchdog finds
- The Louvre will be renovated and the 'Mona Lisa' will have her own room
- Former Danish minister for Greenland discusses Trump's push to acquire island
- Trump's 'stop
- Which apps offer encrypted messaging? How to switch and what to know after feds’ warning
- DeepSeek: Did a little known Chinese startup cause a 'Sputnik moment' for AI?
- NFL Week 15 picks straight up and against spread: Bills, Lions put No. 1 seed hopes on line
- SFO's new sensory room helps neurodivergent travelers fight flying jitters
- Alex Murdaugh’s murder appeal cites biased clerk and prejudicial evidence
- 'Vanderpump Rules' star DJ James Kennedy arrested on domestic violence charges
Ranking
- The Louvre will be renovated and the 'Mona Lisa' will have her own room
- Apple iOS 18.2: What to know about top features, including Genmoji, AI updates
- Rams vs. 49ers highlights: LA wins rainy defensive struggle in key divisional game
- Nearly 400 USAID contract employees laid off in wake of Trump's 'stop work' order
- Appeals court scraps Nasdaq boardroom diversity rules in latest DEI setback
- Nevada attorney general revives 2020 fake electors case
- Mets have visions of grandeur, and a dynasty, with Juan Soto as major catalyst
- What to know about Tuesday’s US House primaries to replace Matt Gaetz and Mike Waltz
Recommendation
What were Tom Selleck's juicy final 'Blue Bloods' words in Reagan family
As Trump Enters Office, a Ripe Oil and Gas Target Appears: An Alabama National Forest
A South Texas lawmaker’s 15
What do we know about the mysterious drones reported flying over New Jersey?
IRS recovers $4.7 billion in back taxes and braces for cuts with Trump and GOP in power
Appeals court scraps Nasdaq boardroom diversity rules in latest DEI setback
Biden administration makes final diplomatic push for stability across a turbulent Mideast
IRS recovers $4.7 billion in back taxes and braces for cuts with Trump and GOP in power