As Holiday Spending Rises, 60% of Americans Live Paycheque to Paycheque

Recent economic trends have highlighted a concerning reality for many American households. Despite a slight easing of inflation, as noted by the Federal Reserve, the financial pressures on families remain acute. 

As we approach the holiday season, which is notorious for being a financial sinkhole that can last throughout the year, a concerning amount of Americans are living paycheque to paycheque, while holiday spending continues to rise. Does a rash of national bankruptcies await the new year? How viable of an option is bankruptcy when faced with mounting debt? Let’s take a look.

Understanding the Ongoing Financial Struggle Amidst Inflation

As the world returns to the normalcy of a pre-pandemic environment, projections suggest that financial conditions for most Americans are similarly strained to the previous two years, but spending trends are skyrocketing by several percentage points.

• Consistent Financial Challenges: Data from a LendingClub report indicates that 60% of adults continue to live paycheck to paycheck, somewhat mirroring last year’s statistics.
• Increased Holiday Spending vs. Debt Accumulation: Predictions by the National Retail Federation suggest a rise in holiday spending, potentially leading to higher debt levels, as seen in the projected increase of up to $966.6 billion in holiday expenses.

The Burden of Credit Card Debt:

A survey by TD Bank shows that 96% of consumers anticipate exceeding their budget in order to complete their holiday shopping this season. Every year, consumers incur debt disproportionate to their normal spending capacity, which is not quickly resolved; although not as common, some consumers carry their holiday spending debt into the subsequent holiday season, leading to a compounding financial issue.

It’s important to remember that credit card debt is considered “unsecured debt”, therefore dischargeable in a Chapter 7 bankruptcy.

Bankruptcy as a Strategic Financial Tool

In light of these economic challenges, bankruptcy emerges as a strategic solution for those overwhelmed by debt. It offers a legal pathway to restructure or eliminate debts and can provide a fresh start for those caught in the grip of financial hardship. For anyone grappling with these issues, consulting with a bankruptcy attorney can be a crucial step towards regaining financial stability. 

Our platform specializes in connecting individuals with experienced bankruptcy attorneys, offering personalized legal guidance tailored to each unique financial situation.

For a free consultation with a qualified bankruptcy attorney, click here or call (833) 598-1595.