US Households Struggle Financially Despite Stable Incomes: National Study Finds

The FINRA Investor Education Foundation's National Financial Capability Study reveals a decline in financial capability among US adults, despite stable incomes. Increased costs have put more households under financial strain, with more adults reporting they spend more than they earn and fewer paying off credit cards in full. Savings have also declined, with 46% of adults unable to cover three months of living expenses. Mobile devices are increasingly used to manage financial products, and knowledge of inflation's impact on savings has improved.

The National Financial Capability Study (NFCS) conducted by the FINRA Investor Education Foundation has revealed a significant decline in financial capability among US adults, despite stable incomes. The study, released in July 2025, represents the sixth wave of data since its inception in 2009. Key findings highlight that more adults are struggling to make ends meet, with increased costs of living putting additional strain on households.

According to the study, 44% of adults now find it easy to pay their bills and expenses, a 10-percentage point drop from 54% in 2021. Additionally, 26% of respondents reported spending more than their income, a significant increase from previous years. The ability to save for emergencies has also declined, with only 46% of adults able to set aside three months' worth of living expenses, down from 53% in 2021. This decline is not attributed to changes in income but rather to the rising costs of living, particularly inflation.

The study found that middle- and high-income groups are disproportionately affected, with declines in financial capability most pronounced among these groups. For instance, the percentage of individuals earning between $25K and $75K who found it not at all difficult to cover their expenses dropped by 14 percentage points, while those earning $75K and over saw a 11-percentage point decline.

Mobile devices are increasingly being used to manage financial products, with a growing number of adults relying on these tools for financial planning and decision-making. Furthermore, there has been an improvement in the understanding of inflation's impact on savings, with more adults recognizing the importance of budgeting and saving in the face of rising costs.

The National Financial Capability Study serves as an essential resource for policymakers, educators, and financial professionals seeking to address the financial capability needs of Americans. The findings underscore the need for targeted financial education and support to help individuals navigate the challenges posed by inflation and other economic factors.

References:
[1] https://www.finra.org/media-center/finra-unscripted/nfcs-key-trends-and-insights