Nearly one-third of low-income US households are living paycheck to paycheck

More Americans Struggling to Make Ends Meet

Recent data from Bank of America reveals a concerning trend: a growing number of Americans are living paycheck to paycheck. The study, released on Tuesday, found that nearly 24% of all households are classified as living paycheck to paycheck this year, with lower-income earners bearing the brunt of financial strain.

The data shows that 29% of lower-income households are living paycheck to paycheck, up from previous years. This trend is likely due to slowing wage growth for this cohort, as wages for lower-income earners have been lagging behind higher-income earners since the beginning of 2025.

By age, the data shows that middle-aged households, including millennials and Gen X, have been struggling to cover basic expenses since last year. On the other hand, higher-income millennial households have seen their wages grow at a faster rate.

The data reflects a “K-shaped economy,” where higher-income asset holders drive consumer spending and fare better than lower-income households. This economic divide is evident in consumer trends and the performance of companies in the Consumer Staples sector, such as Chipotle and McDonald’s, who have highlighted the challenges facing lower-income earners.

“Think about the low-income consumer and the pressures they face – high rents, food prices, childcare costs,” McDonald’s CEO Chris Kempczinski remarked recently, underscoring the financial struggles many Americans are currently facing.