Most middle-class households say income falling behind cost of living - NEWS TV USA

Most middle-class households say income falling behind cost of living

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The reality of inflation and the specter of a recession appear to be weighing heavily on middle-class households.

Among those whose income falls in the $30,000-to-$100,000 range, 75% say their earnings are falling behind the cost of living, and 77% think the U.S. will be in a recession by the end of 2022, according to a recent survey from Primerica.

There’s also been a general uptick in financial worries in the last six months, with 39% of those surveyed expecting to be worse off financially in a year, up from 32% in March and 28% in December 2021. In December 2020, that share was 17%.

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“There’s a higher level of concern financially among middle-income families than there was even at [the height] of the pandemic,” said Glenn Williams, CEO of Primerica.

The June survey of nearly 1,400 adults was done as part of Primerica’s quarterly check-in on the financial security of middle-income families. 

‘Tougher decisions around priorities’

Recession or not, set aside some cash

The question looming large is whether the economy will skirt a recession — which is generally defined in the U.S. as a significant economic decline that lasts more than a few months — and economists are split on whether there’s one on the horizon. 

Either way, if your finances have you more worried than usual and you fear a loss of income in the months ahead, it’s worth setting aside some emergency funds if possible.

“Now, of all times, you want to try to put aside some cash for emergencies like a layoff or a broken home HVAC unit,” Hauer said. “Many Americans live paycheck to paycheck, which is never good but can cause insurmountable problems if the economy tanks.”

Additionally, keep debt under control, Williams said.

“We understand people are using [credit cards] to fill gaps right now … but as soon as possible try to turn that around,” he said.

The average rate on credit cards has been ticking upward and now averages more than 17%, according to Consumers’ tab stood at a collective $840 billion in the first quarter, down $15 billion from the preceding quarter but $71 billion higher than a year earlier, according to the Federal Reserve Bank of New York.

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