Why Americans Can’t Keep Their Paychecks?
70% of Americans have less than $1,000 in savings
It’s a familiar feeling for many Americans — you get your paycheck, but it seems to vanish before you even have time to cash it.
Rent, utilities, car payments, and other bills eat up a huge chunk, leaving little left over for savings or discretionary spending. This cycle of living paycheck to paycheck is an increasingly common reality.
Recent surveys show around 70% of Americans have less than $1,000 in savings, and nearly 40% would struggle to cover an unexpected $400 expense.
So what’s causing this mismatch between income and expenses that keeps so many Americans barely treading water financially?
There are a few key factors at play:
Stagnant Wages
While productivity has risen steadily since the 1970s, inflation-adjusted hourly wages for the typical worker have been relatively flat.
Raises have lagged behind the increasing costs of housing, healthcare, childcare, and other major expenses. This means workers have less purchasing power and fewer discretionary funds.
For example, average hourly earnings for production and nonsupervisory workers in January 2023 were $25.67, just 3%…
