The Courier-Journal (Louisville)
Many Americans tightening belts, but not everybody
Inflation continues to vex the American consumer, with prices rising 3.7% over the past year.
Not surprisingly, the vast majority of American consumers say they are cutting back: 92%, according to a recent CNBC-Morning Consult survey.
In a June poll by CNBC and Morning Consult, nearly 80% of consumers said they had cut spending on nonessential items, a category that covers entertainment, home décor, appliances and clothing.
A more recent survey by the same pollsters, conducted in September, shows which nonessential items consumers are most likely to do without: clothing (63%), restaurants and bars (62%) and entertainment outings
(56%). Each CNBCMorning Consult poll covered roughly 4,400 adults.
A smaller share of consumers, about twothirds, are spending less on essential goods, such as groceries, utilities and gas, according to the June survey.
The poll noted that consumers are spending more at value-oriented supermarkets and less at higher-priced alternatives.
Boomers and Generation X are scaling back on extravagant spending, according to a recent McKinsey & Co. survey.
The share of adults who intend to splurge this year ranges from a low of 20% among boomers to a high of 55% among Gen Zers, with the figure rising by age. The data come from a representative survey of 4,000 adults taken in August.
More revealing, perhaps, is what consumers are splurging on. The most popular items are food-related: restaurants and grocery stores.
One way to stave off inflation’s sting is to put off paying for things. A recent poll from LendingTree, the online loan marketplace, found that 46% of Americans have used a form of short-term financing called buy now, pay later, up from 31% in 2021.
More than 1 in 4 consumers who used the deferred payment service said they used it as a bridge to their next paycheck. One in 5 used the service to buy groceries.
Younger Americans seem most comfortable with buying now and paying later, or at least most likely to use it. Nearly two-thirds of Gen Zers and 55% of millennials said they had made such purchases, compared with 24% of boomers.
The findings come from a representative survey of 2,044 consumers conducted in March.
With auto insurance premiums skyrocketing, a larger share of American drivers are choosing to forgo insurance.
The share of American households without insurance rose from 5.3% to 5.7% between the second half of 2022 to the first half of 2023, according to a report from J.D. Power.
In New Hampshire, the share of uninsured drivers has risen from 4.3% to 7.9% in that span. In South Dakota, the share has doubled from 3.3% to 6.8%. In Indiana, the rate has risen from 5.5% to 7.5%.
While survey after survey shows consumers tightening their belts, Americans are, in fact, spending more this year than last.
Median household spending rose by 5.5% in August, compared with the same time in 2022, according to the New York Federal Reserve Bank’s SCE Household Spending Survey.
That means we are spending above inflation, which boosted prices by 3.7% between August 2022 and August 2023.