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HomeTop Global News62% of Americans still live paycheck to paycheck amid inflation

62% of Americans still live paycheck to paycheck amid inflation

Why Americans can't stop living paycheck to paycheck

‘Inflation is still too high’

Households must make ‘tough choices’

“Many households are seeing their finances stretched thinly by the combination of high prices for goods and services as well as high interest rates,” said Brett House, economics professor at Columbia Business School.

“Many are having to make tough choices to defer discretionary spending in order to stay on top of their loan payments and the costs of necessities,” he added. The resumption of student loan payments only adds to this stress.

Some 74% of Americans say they are stressed about finances, according to a separate CNBC Your Money Financial Confidence Survey conducted in August. Inflation, rising interest rates and a lack of savings contribute to those feelings.

That CNBC survey found that 61% of Americans are living paycheck to paycheck, up from 58% in March.

Many households have tapped their cash reserves over the past few months, LendingClub and other reports show.

Nearly half, or 49%, of adults have less savings or no savings compared with a year ago, according to a Bankrate survey.

On the upside, those with remaining balances, which are concentrated among high-income households, are seeing “better interest payments than they’ve received at any time in the recent past,” House said.

High-yield savings accounts, certificates of deposits and money market accounts are now paying more than 5%, according to Bankrate, which is the most savers have been able to earn in nearly two decades.

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