Are Americans getting ready to rein in spending? – RetailWire

May 05, 2022

American consumers, for the most part, continued to spend according to established habits despite rising prices for everyday basics driven by inflation. That, however, may be changing – research from a variety of sources shows that many people need to adjust their spending to stretch their available cash.

A new survey of American Consumer Credit Counseling of households earning $100,000 a year or less, finds that 93% have personally felt the effect of rising prices on everyday items. Mmore than 30% have made changes to reduce their fuel costs. Nineteen percent reduced their grocery purchases. More than half of travel plans canceled or changed for summer.

“This spike in costs across nearly every category of consumer goods is a significant burden on American households, Allen Amadin, president and CEO of American Consumer Credit Counseling, said in a statement. “Discretionary spending is usually the first thing to curb in times of financial crisis. When people are forced to buy fewer groceries or change their transportation habits, we’ve entered a whole new level of challenge. »

New to research of LendingClub Corporation and PYMNTS finds that 64% of Americans currently live paycheck to paycheck. This could cause consumers to take on more debt, further limiting their ability to spend later.

“The number of people living paycheck to paycheck today is reminiscent of the early days of the pandemic and it has become the dominant way of life across all income brackets,” said Anuj Nayar, manager. financial health at LendingClub. “As inflation the likes of which we haven’t seen in a generation takes a bigger chunk out of our paychecks for everyday needs, Americans, regardless of income and credit scores, are increasingly counting on credit products just to get by.”

Malt-O-Meal, the value-priced bagged cereal brand, has also launched to research which shows that price becomes critical for buying decisions. Seventy-one percent of respondents said they were more likely to shop on a budget than before the pandemic. Households with children are 21% more likely to do so than those where no children are present.

Fifty-three percent of respondents buy value brands to stretch their grocery purchases. Forty-five percent shop using a sales flyer and 43% use a store’s rewards app.

DISCUSSION QUESTIONS: Do you think the point has been reached where a large percentage of Americans will significantly change the way they shop to save money? How will this affect retailers who sell products that fall under the discretionary spending category?


“As consumers adjust their expectations and reduce their drinking habits, we will see continued reductions over time.”


About Jonathan J. Kramer

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