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Increasing living expenses have remained a constant source of stress for many Americans, forcing families to rethink their budgets, modify their financial goals, and have tough conversations about money.

Why Cost of Living Tops Americans’ Worries

Recent national surveys show that almost everyone is worried about the cost of living. In one national study, nine out of ten Americans (90%) called it a “cost‑of‑living crisis.” About half (49%) say they sometimes struggle to pay for basics like rent and groceries. Inflation and rising prices are now the top issues people want solved, ahead of other concerns.

The main reason for this anxiety is the growing gap between what things cost and what people earn. Overall inflation has slowed since the pandemic. However, the price of essentials keeps climbing faster than most paychecks. Many households feel squeezed, even when headlines say inflation is improving.

Where Households Feel the Squeeze

Americans feel the most financial pressure in a few key areas of daily life. These basic expenses—such as housing, food, and childcare—can’t be easily cut, so any price increase hits immediately.

• Housing: The cost to own or rent a home has risen steadily. Median monthly owner costs and median gross rents have increased in recent years. An analysis found that housing costs for a “basic but secure” standard of living rose by more than 10% in 2024 alone.
• Groceries and necessities: Many Americans worry about paying for food and other daily needs. Most say they are concerned about affording groceries, clothing, and household items.
• Childcare: For families with young children, childcare is one of the fastest-rising costs. Recent data shows a X% annual increase—the largest on record—placing more strain on working parents.
• Health care: Year‑to‑year growth in medical costs has slowed at times. Yet health care remains one of the fastest‑rising expenses over the long term. It is a major concern for many households.
• Debt and monthly bills: Many Americans worry about keeping up with their monthly bills. Paying for utilities and transportation is also a concern as prices rise.

These expenses take up a large share of the average household budget. Even small price hikes can quickly make it harder to get by. That’s why the cost of living is still a top worry, even when big-picture numbers look better.

How Americans Are Adapting

Families are making many changes to cope with higher living costs. Many are cutting back on non-essentials and finding creative ways to make money go further.

Common responses reported in recent surveys include:

• Trading down to lower‑cost brands, shopping sales more aggressively, and buying fewer non‑essential products.
• Cooking at home more instead of dining out, and choosing cheaper entertainment options.
• Delaying large purchases, home projects, or travel to save cash or avoid new debt.
• Taking extra work, such as overtime, second jobs, or gig work, to cover rising costs.

Many people worry they can't save enough or keep an emergency fund. Staying on track for big goals like retirement is hard. For many, keeping up with the bills each month is now the main focus. Long-term plans are being pushed to the back burner.

Why Planning Still Matters

Higher living costs put real pressure on families. Careful planning is now more important than ever. Setting a budget, building an emergency fund, and managing debt help you handle rising expenses. Habits like reviewing bills, boosting income, and sticking to a savings plan can ease tough times over the long run.

For many, working with a financial professional brings a clearer view. They help you weigh choices and create a plan as costs rise. A financial adviser can’t control inflation or housing prices. However, they can help you make informed budget, savings, and investment decisions when money is tight.

Disclosures

This material is for general informational and educational purposes only and does not constitute investment, tax, or legal advice. The information discussed reflects third‑party data and surveys believed to be reliable as of the dates cited, but accuracy and completeness cannot be guaranteed and may change without notice. Any views expressed are broad economic observations and are not a recommendation or solicitation to buy or sell any security, strategy, or financial product, nor are they a promise or guarantee of any future economic or market result.

Past economic trends, including inflation and cost‑of‑living data, do not guarantee future conditions, and actual outcomes may differ materially from expectations. All investments involve risk, including the possible loss of principal, and individuals should consider their own circumstances and consult with a qualified financial professional before making any financial decisions.

Sources
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