First, the sobering news: well over half of consumers live paycheck to paycheck.
The most optimistic news: Those with less financial cushion are the most eager to increase their purchasing activity as the pandemic ends.
These and other trends in spending and consumer behavior have recently been highlighted by LendingClub Corporation, via research conducted with PYMNTS.com. According to the latest research series “Reality Check: Paycheck-to-Paycheck,” 57% of Americans, or about 131 million people, were living a paycheck-to-paycheck-to-paycheck lifestyle in September. That’s down from a high of 65% in December 2020, but up from a low of 52% last April.
Several factors contribute to the upward trajectory of consumers who are more strapped for available funds. The latest findings from LendingClub Corporation and PYMNTs.com point to higher inflation, rising housing costs, changes in government support for a pandemic, and an overall drop in consumer confidence.
Highlighting the continued impact of the global health crisis, the study found a direct correlation between the financial situation of consumers and their apprehension about COVID-19. Nearly two-thirds of consumers who live paycheck to paycheck are “very concerned” about the pandemic, compared to about half of those who are more financially secure.
That said, once the world enters a post-pandemic phase, affected consumers say they will return to spend mode, both in physical stores and online. A third of all consumers said they would visit physical stores more often, and a quarter of paycheck-to-paycheck shoppers said they would increase their digital purchases even after the pandemic, compared to 17% of consumers in financial security.
“Despite the financial toll of this global health crisis, these results indicate that the end of the pandemic will significantly boost the confidence of American consumers and lead to long-term behavior change,” said Anuj Nayar, head of financial health at LendingClub. .
Nayar also stressed the importance of rebuilding more financial security among all buyers, adding: “As consumers have faced the punches that the pandemic threw at them last year, it is now more important than ever. that they can begin to take control of their financial lives and create savings to protect them from the continuing effects of the pandemic or other unexpected crises. “