Financial Insecurity Stalks Most Americans Amid Economic Uncertainty
Poll Shows Over One-Quarter of U.S. Citizens Believe They Need an Annual Income of $150,000 or Above to Maintain a Comfortable Lifestyle
Admit it - financial security should be a reality for all Americans. But in today's climate of high prices, tariffs, and economic turmoil, it's a dream that eludes many. According to a recent survey on our website, a staggering 77% of American adults don't feel fully secure financially, with the percentage increasing from 72% in 2023 and 75% in 2024.
One reason behind this financial insecurity could be inflation. Over the past three years, inflation has quickly eroded households' purchasing power, making it challenging for people to maintain their lifestyles with their current salaries. For instance, a $100,000 salary in 2020 is equivalent to a buying power of $124,353 in 2025, according to the U.S. Bureau of Labor Statistics (BLS). In other words, if you haven't received a raise since 2020, you might feel like you've lost $24,000 of your income thanks to inflation.
Wookjae Heo, an assistant professor of financial counseling and planning at the Purdue University College of Health and Human Sciences, explains, "Many people need to spend more and more every year because of inflation. However, their income has not increased significantly. Most people's salary is static."
A pay bump could help alleviate the financial pain, but a big one would be required. Roughly a quarter (26%) of American adults said they'd need to earn $150,000 or more per year to feel financially secure. That's nearly double the national average salary, which was $81,515 in 2023, according to the latest estimates from the BLS.
Unfortunately, companies are slowing down hiring, making it tough for people to switch jobs in search of better pay. In a sluggish job market, especially for white-collar and federal workers, achieving that six-figure salary may prove difficult.
Men
Factors Draining Financial Security
30%
Insecurity looms over Americans for several reasons:
27%
- Economic Downturn and Job Market Challenges: The U.S. economy faces a looming recession, with GDP forecast to fall by 1.7% in 2026, leading to job losses and increased unemployment.
- Inflation and Rising Costs: Persistent inflation is a top financial concern for most Americans, driving up prices and straining household budgets.
- Housing Affordability Crisis: High home prices, mortgage rates, and additional costs such as property taxes, insurance, and maintenance strain household budgets, making homeownership, a cornerstone of the American Dream, less attainable.
- Financial Literacy Gaps: Significant disparities in financial literacy, particularly among women and ethnic minorities, impede effective financial management, increasing the risk of financial instability.
- Stagnant Wages and Income Inequality: Stagnant wages and income inequality keep households from building savings or investing in long-term assets.
- Social and Structural Challenges: Tangible challenges like homelessness, substance abuse, mental health issues, and crime further exacerbate financial problems and create a cycle of instability.
26%
Challenges on the Path to the American Dream
20%
The impact of these factors creates a hostile environment for many Americans aspiring to achieve the American Dream:
Women
- Reduced Homeownership: High housing costs and limited availability of affordable housing impede many families from purchasing homes.
- Increased Financial Fragility: The inability to cover unexpected expenses reflects precarious finances that prevent long-term wealth accumulation.
- Lower Consumer Confidence and Spending: Economic uncertainty leads to reduced consumer confidence and conservative spending, slowing economic growth and job creation.
- Generational Impact: Inequality created by barriers to financial security and homeownership will persist across generations, hindering upward mobility.
26%
In conclusion, a combination of inflation, economic uncertainties, and housing affordability crises contribute to the financial insecurity faced by many Americans. This discouraging reality threatens the core aspirations of financial stability, homeownership, and social mobility long associated with the American Dream.
23%
In light of the persistent financial insecurity seen among Americans, efforts towards personal finance management, such as investing and understanding business principles, could provide a path towards greater financial security. Moreover, addressing factors like inflation, economic downturns, housing affordability, and financial literacy gaps is crucial in helping more individuals achieve their dreams of personal-finance stability and homeownership.
