Fewer Americans are living paycheck to paycheck: Just 48% say they're living paycheck to paycheck, down from 69% last year and the lowest level in five years.
Budgeting is more important than ever: Despite the improvement, 95% of Americans say rising costs and economic uncertainty have made sticking to a budget a necessity.
Experts say now is the time to prepare: Financial experts recommend creating a budget and paying down high-interest credit card debt before the economy faces its next major shift.
After years of rising prices and economic uncertainty, there's finally a bit of encouraging news for household finances: fewer Americans say they're living paycheck to paycheck than they have in the past five years. But that doesn't mean people are feeling financially secure.
A new survey from Debt.com found that while the number of Americans living paycheck to paycheck has dropped significantly, nearly everyone still feels pressure from higher costs and an unpredictable economy.
ConsumerAffairs spoke with Howard Dvorkin, CPA and chairman of Debt.com who explained that budgeting remains one of the best tools consumers have — not just for getting through today's challenges, but for preparing for whatever comes next.
Methodology
Debt.com's ninth annual Budgeting Survey polled 1,051 U.S. adults ages 18 and older from all 50 states and Washington, D.C. Participants answered 13 questions about their budgeting and spending habits, with responses collected through SurveyMonkey.
Here are some of the key survey findings:
48% of Americans say they're living paycheck to paycheck, down from a record 69% in 2025, and the lowest level since Debt.com began tracking the measure in 2022.
95% of respondents said economic uncertainty and rising living costs have made budgeting more important than ever.
85% of Americans currently keep a budget.
88% of those who do say budgeting has helped them get out of debt or avoid it altogether.
Among people who don't budget, the most common reason has shifted from not having enough income to simply feeling that budgeting is too time-consuming.
“After years of growing financial pressure, Americans forced themselves to adjust, tighten their belts, and rethink their spending,” Dvorkin said. “They didn't get a break from inflation, so they learned how to budget through a crisis.
“The fact that 95% say budgeting is more important than ever proves that consumers have adopted a permanent crisis-budgeting mindset. But make no mistake – 48% is still nearly half the country running on a financial tightrope and living paycheck-to-paycheck.”
Starting a budget today
With nearly 90% of survey respondents saying that budgeting has helped them in substantial ways, Dvorkin shared some of his best tips for consumers looking to get started today.
“Budgeting has never been easier, because you don’t even need to do the math anymore,” he said. “I’m old, and back in the dark ages before the millennium, you had to put pencil to paper and use a clunky calculator to create a monthly household budget.
“These days, there are dozens of free apps that do the heavy lifting for you. They all allow you to enter your expenses, and they do the math. These days, there's literally no excuse not to budget.”
Preparing your finances
Given that economic conditions are uncertain, being prepared is consumers’ best tactic. Dvorkin shared a few ways for consumers to prepare their finances for any future situation.
“If you want to recession-proof your finances, shed your credit card debt,” he said. “There’s no higher interest rate you’ll pay in the course of daily living. Right now, the average credit card is charging around 20% interest, which means you’re handing $1 to your credit card issuer for every $5 you charge.
“Of course, it’s easy to say, ‘pay off your balances.’ Doing it can be a chore. So you should call a nonprofit credit counseling agency and get a free debt analysis over the phone. After the intensive deep dive, your counselor will give you a menu of options that can slash those balances. The time to call is now, before the economy takes its next inevitable turn. You’ll have more options today than you will then.”