A recent survey by Debt.com reveals a troubling trend in the financial health of Americans, showing that while budgeting has become more common, financial stability has not improved for many. The 2024 survey found that 90% of U.S. adults now budget, up from 70% seven years ago, yet the percentage living paycheck to paycheck has risen from 50% in 2022 and 2023 to 60% in 2024.
Howard Dvorkin, CPA and chairman of Debt.com, noted, "Budgeting is becoming more widespread and helpful, but it hasn't entirely protected Americans from financial difficulties." This observation points to the complex economic pressures facing individuals, suggesting that budgeting alone may not be enough to counteract issues like inflation and stagnant wages.
Despite the challenges, the survey also found positive outcomes from budgeting, with 89% of respondents saying it helped them get out of or stay out of debt, up from 73% in 2018. Millennials led this trend at 92%, followed by Gen X at 90%, Baby Boomers at 86%, and Gen Z at 83%. The reasons for budgeting varied, including increasing wealth and savings (38%), tackling debt (21%), and coping with inflation (17%).
The survey uncovered gender differences in budgeting practices, with men (94%) budgeting more than women (87%). Women who didn't budget often cited low income as the reason, while men found budgeting too time-consuming. These findings highlight the diverse financial challenges and behaviors across demographics.
The rise in paycheck-to-paycheck living, despite more widespread budgeting, suggests broader economic issues are at play. The survey's implications for financial education and policy are significant, indicating that while budgeting is a valuable tool, additional measures may be necessary to address the financial instability many Americans face. As economic conditions evolve, the need for comprehensive financial wellness strategies becomes increasingly clear.
