It is getting harder for workers at all income levels to make ends meet because of inflation.
The consumer price index increased 8.3% in April from a year ago, the largest jump since 1982, according to the latest data from the US Department of Labor.
Wage growth isn't keeping up with the increase in cost of living
Wages will not go as far at the grocery store or the gas pump when wages rise at a slower pace than inflation.
25% of Americans are postponing retirement due to inflation, and the job market is still hot.
According to a report, as of April, 61% of consumers said they were living paycheck to paycheck.
The report found that even topearning people are stretched thin. 34% said they live paycheck to paycheck.
It is clear that earning a quarter of a million dollars a year is high income. It's surprising that a third of them are living paycheck to paycheck.
The high income earner has an average score of 758. They have higher financial obligations and are more likely to use their capital to finance their life.
The survey said that consumers who are struggling to afford their day-to-day lifestyle tend to rely more on credit cards and carry higher monthly balances.
I’ve seen households of all means fall into this trap.
A certified financial planner and senior financial planning consultant at Fidelity, Joe Buhrmann, has seen households fall into this trap.
He said to follow the 50-20-30 rule if the issue is a result of overspending.
The rule of thumb is 50% on needs, 30% on wants, and 20% on savings and debt reduction.
According to a report from the Federal Reserve Bank of New York, credit card balances rose year over year in the first three months of the year.
According to Ted Rossman, a senior industry analyst at CreditCards.com, balances could soon reach a record level due to higher prices for gas, groceries and housing.
Anyone with revolving debt will see the annual percentage rate on their credit card go up.
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