US Financial Vulnerability Rises to 17% as Low-Income Households Cut Discretionary Spending

The share of U.S. households feeling financially vulnerable rose to 17% in 2026 from 15% a year earlier, reversing prior progress, according to a survey by The Financial Health Network and the University of Southern California. Fewer than 70% of respondents said they paid all bills on time over the past 12 months, down 3 percentage points year over year. Those reporting unmanageable debt climbed to 31% from 29%. More than a quarter of student loan borrowers now describe themselves as financially vulnerable, up from 21%. Since 2019, low-income consumers redirected more than $10 billion from discretionary purchases toward essentials such as groceries, while higher-income consumers shifted more than double that amount toward discretionary spending, per Numerator. Prices for low-income consumers have risen 35% since January 2018, versus 31% for high-income households. Retail sales in Retail Dive-covered segments rose 6.7% year over year in August, though elevated inflation, higher oil prices and rising transit costs could pressure 2026 sales trends.