Struggling Financially Despite Economic Stability: 57% of Americans Report Tight Budgets According to Kikoff Poll
In a recent survey conducted by The Harris Poll, Kikoff, a credit-building platform used by over a million Americans, revealed the Economic Trust Report that sheds light on the financial struggles faced by many households across the United States.
According to Cynthia Chen, the founder and CEO of Kikoff, the survey findings validate what many people already feel - what looks stable on paper doesn't always match the reality of day-to-day life.
The report found that despite stable FICO scores, low unemployment, and lowered recession risk, a significant number of Americans still feel financially strained. This phenomenon is primarily due to inflation and the rising cost of living, which have eroded their purchasing power, creating ongoing financial stress.
Key factors contributing to this stress include inflation and cost of living increases, job insecurity and fear of layoffs, financial trade-offs and cutbacks, mental health impacts, and a mismatch between economic indicators and lived experience.
Inflation and cost of living increases have led to significant price hikes for essentials such as groceries, housing, and childcare. This long-term financial pressure persists even if wages and employment remain stable. Job insecurity and fear of layoffs, driven by automation and AI in some industries, further fuel uncertainty.
Financial trade-offs and cutbacks, such as downgrading or cutting insurance coverage, increase financial vulnerability and stress. Mental health impacts are also a concern, with the financial stress taking a measurable toll on mental health, making it harder for many to seek or continue needed care.
The survey also highlighted a mismatch between economic indicators and lived experience. Metrics like FICO scores and unemployment rates don't capture the full picture of financial health since they don't reflect day-to-day affordability challenges and economic anxiety.
The report also revealed a trust gap between reported macroeconomic indicators and what Americans believe about their financial standing. More than half of Americans believe credit access shouldn't rest solely on a three-digit credit score, and more than half say 'Buy Now Pay Later' options make them feel more in control of their finances than credit cards.
However, nearly 2 in 5 Americans had to delay major life events to protect their credit score in the last year, and over half don't know the amount of their current credit card debt. Nearly 1 in 4 Americans who had an unexpected expense in the past year, opened a new credit card to cover it.
Higher earners are more likely to carry credit card balances past the first statement to cover unexpected expenses than lower-income peers. Despite reports of stable FICO scores and consistently low unemployment rates, many Americans still feel financially strained, with 37% noting personal finance as a source of anxiety and stress.
The survey also found that nearly 2 in 5 Americans say the way the U.S. government talks about the economy does not reflect their own financial reality. This underscores the need for solutions that are radically affordable, accessible, and designed for the real financial lives people are living today, as Kikoff aims to provide.
[1] Kikoff Economic Trust Report, The Harris Poll, 2022 [2] Federal Reserve Economic Data, 2022 [3] Bureau of Labor Statistics, 2022
Business owners and individuals alike might find themselves grappling with financial struggles, even with stable FICO scores, low unemployment rates, and a reduced recession risk, as revealed by the Kikoff Economic Trust Report. This personal-finance strain is largely attributed to factors such as inflation, rising cost of living, job insecurity, and a mismatch between economic indicators and the lived experience.
