Middle-income consumers in the United States continue to be more concerned about inflation than other economic issues, which is affecting how they spend their money, according to Primerica’s Financial Security Monitor.
The latest Primerica Household Budget Index, which measures the purchasing power of middle-income families, found that perceptions of personal finances align with overall economic conditions, with 86% of respondents in the company’s Financial Security Monitor survey expecting the costs of food and groceries to rise in the coming months along with utilities, for 77%, and fuel, for 76%. Average purchasing power for necessities dropped 0.3% in February compared to January, according to Primerica, as middle-income families paid more for less. Higher car insurance, gasoline and utilities costs were the main drivers for the decrease.
Middle-income Americans are increasingly concerned about their financial futures, Primerica noted, as 46% of respondents said they expect their financial situation to worsen in the coming year, up from 27% in the 2024 fourth quarter. Only 18% believe their situation will improve over the next year, versus 26% of respondents in the previous survey. With that, 78% of consumers reported limiting non-essential purchases, such as eating out and entertainment, and 64% said they are setting aside money for an emergency fund, up from 59% in the earlier survey.
To deal with additional expenses, 52% of consumers indicated they were either considering getting or already having a second job, while 55% said they are considering changing or actively switching jobs.
On a brighter note, 53% of consumers anticipated getting money back on their tax returns this year. Still, many consumers plan to be conservative with the money, as the top plans for refunds include saving, for 38%, paying down debt, for 32%, and/or paying outstanding bills, for 30%.
“Middle-income Americans continue to face significant financial stress, and they are not anticipating relief in the near future,” said Glenn Williams, CEO of Primerica, a financial products and services provider.
Amy Crews Cutts, economic consultant to Primerica, added, “Middle-income Americans are navigating a financial landscape that feels increasingly unpredictable, with rising costs stretching household budgets and disproportionately impacting middle-income families, accounting for over 55% of the U.S. population. Cost increases are weighing heavily on households, signaling deep unease about the road ahead.”
