As Interest Rates Climb and Recession Fears Mount, Here’s How Americans Are Cutting Back

Asian woman stares at the check for dinner at the restaurant, her eyes bulging. The concept of inflation and devaluation of money and reduction of purchasing power of the population. stock photo
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Amid continued inflation, as evidenced in the latest Consumer Price Index (CPI) report released by the U.S. Bureau of Labor Statistics (BLS), Americans are cutting back on non-necessities.

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A recent CNBC-Momentive poll on financial literacy found that in the last six months, 53% of Americans have cut back on dining out, while 39% have cut back on driving. Meanwhile, more than one-third (35%) have canceled a monthly subscription, and 32% tried to cut costs at the grocery store by switching from brand-name products to generic.

If inflation continues, the report indicated that 52% will cut back on dining out, while 42% said they would reduce driving. Forty percent reported they might even cancel a planned vacation, and 36% will evaluate their monthly subscriptions to see where they can trim non-necessities out of their budget.

Americans are bracing themselves for a recession this year, as 81% think it’s likely to occur, while 61% disapprove of Biden’s tactics to manage inflation. As a result of these fears, 52% say they are under more financial stress today than they were a year ago, when the global pandemic was still near its peak and the country was recovering from shutdowns. More than three-quarters (76%) said they worry that higher prices will force them to rethink their financial choices going into summer.

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Not surprisingly, inflation seems to be hitting those at the lowest income levels harder. Of those surveyed with household incomes under $50,000, 55% said they think about the effects of inflation and worry about rising prices “all the time.” Forty-five percent of those with income between $50,000 and $100,000 say they think about rising prices all the time. The problem does plague six-figure earners, too. Forty percent of those making $100,000+ think about rising prices all the time.

Only 1% across all demographics polled say they “never” think about rising prices, while 28% of all people polled think about them “sometimes.”

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What costs are Americans worried about the most? Twenty-one percent cited “gas prices” as causing the most financial stress over the past year, while 16% are most stressed about housing costs and 13% worry about the price of food. Only 8% worry about COVID-related financial setbacks, showing that inflation is a greater concern than other factors. Worries over debt, student loans, fear of job loss and child care costs plague only a small percentage the population polled in the survey.

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About the Author

Dawn Allcot is a full-time freelance writer and content marketing specialist who geeks out about finance, e-commerce, technology, and real estate. Her lengthy list of publishing credits include Bankrate, Lending Tree, and Chase Bank. She is the founder and owner of, a travel, technology, and entertainment website. She lives on Long Island, New York, with a veritable menagerie that includes 2 cats, a rambunctious kitten, and three lizards of varying sizes and personalities – plus her two kids and husband. Find her on Twitter, @DawnAllcot.
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