(WatchDogReport.org) – The results of a recent Lending Club survey show that workers earning over $100,000 per year are living paycheck to paycheck. Over 40% of earners in this range are struggling to keep up and feel financially insecure. More than 60% of Americans making less that $100,000 per year are in the same boat.
Living paycheck to paycheck means that a normal paycheck is only sufficient to cover the immediate living expenses and pay the bills currently due with little to nothing leftover for savings.
Some media sources want to blame “unnecessary spending” for exacerbating the problem, but the numbers in most cases don’t back up this assumption. According to Lending Club, the standard middle-income earner makes around $57,000 annually. This breaks down to take-home pay of approximately $3300 per month after taxes and benefits. As of June 2023, the median monthly rent in the U.S. is approximately $2000. The monthly mortgage payment on a 2400 sq ft house is just over $1900. The average monthly food cost for Americans is more than $690. Don’t’ forget utilities, transportation, healthcare, etc. This leaves Americans with no breathing room and no financial cushion to cover even minor emergencies or unexpected costs.
Credit card debt is at an all-time high reaching $1.03 trillion in the second quarter of 2023. With average credit card interest being over 20%, many Americans are drowning in debt and defaulting on payments.
Is the Biden administration to blame? Since President Joe Biden took office, the cost of living has increased 16% due to inflation. Since January of 2021 the consumer price index for food has increased by 19%. The cost of electricity is up by 23%. Vehicle repairs have increased by 23% and used cars cost 30% more.
Most Americans are not plagued with “unnecessary spending”, but with the challenge of keeping up with rising costs and inflation.
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