Financial Strain forces Nearly Half of U.S. Workers to Take on Debt for Basic Needs
A new survey reveals a growing crisis of financial insecurity among American workers, with nearly half (48%) resorting to debt to cover essential expenses like groceries and utilities in the past year. The findings, released by Zety, highlight a concerning trend of “survival debt” as persistent inflation and economic pressures erode household budgets.
The escalating reliance on borrowing for day-to-day living is forcing difficult trade-offs, delaying critical life milestones and impacting long-term financial well-being. More than half of workers (56%) report thier current salary is insufficient to manage debt obligations and simultaneously save for the future.This situation disproportionately affects younger generations and those with lower incomes, potentially exacerbating existing wealth gaps and hindering economic mobility.
The Zety survey details the sacrifices Americans are making to stay afloat. forty-four percent have postponed or canceled travel plans, while 41% have reduced spending on entertainment and dining. Notable numbers are also cutting back on hobbies (36%),delaying car purchases (24%),and postponing retirement savings (22%). The financial strain is even impacting major life decisions, with 16% delaying homeownership and 8% delaying having children or expanding their families. A troubling 10% have even skipped necessary medical care or prescriptions.
“What stands out in these findings is how pervasive financial strain has become,” said Jasmine Escalera, career expert for Zety.”Employees are juggling multiple debts while trying to cover day-to-day expenses, a pattern we call ‘survival debt.’ This kind of borrowing frequently enough comes at the expense of crucial life milestones-buying a home, saving for retirement, or investing in their careers.”
Only 30% of those surveyed reported they haven’t had to make any sacrifices to manage their debt, underscoring the widespread nature of the financial challenges facing U.S. workers. The findings signal a need for increased financial literacy resources, wage growth, and policies aimed at alleviating the burden of debt on American households.
