27% of Americans Earning Under $75K Skip Meals or Sell Possessions To Get By — 3 Ways To Better Allocate Your Paycheck
Written by
Vance Cariaga
Edited by
Susan Kim
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As with any problem, money problems have varying degrees of severity. Some people who struggle to pay the bills have to sacrifice luxuries or cut back on discretionary spending. Others take it a step further by skipping meals or selling possessions to get by. The latter measures are more common than you might think, according to a new report from Assurance IQ.
The report, titled “Financial Well-Being 2024: The Challenges & Sacrifices Facing American Households,” was based on a survey of 5,000 U.S. adults earning less than $75,000. Among its findings was that among Americans earning less than $75,000 a year, three-quarters have had to make tradeoffs to pay their monthly bills. That compares to 50% of those earning $150,000 or more.
Nearly one-third of those earning less than $75,000 (31%) said they skipped meals to make ends meet. More than one-quarter (27%) said they sold possessions. Other tradeoffs include the following:
- Borrowed money or used a credit card (46%)
- Paid a bill late (47%)
- Overdrew bank account (28%)
- Negotiated payment terms (25%)
- Cancelled or decreased insurance coverage (9%)
Nearly half (46%) of all survey respondents said they avoided medical care in the past year due to costs. The leading reasons were that they weren’t sure they could afford it (56%), they weren’t sure the care was covered by insurance (41%) and they didn’t want their insurance costs to go up (26%).
Many people in the lowest income brackets have little choice but to take drastic measures to pay their bills. In these cases, the best immediate solutions are to seek help from social services agencies or supplement your income through a second job or side gigs.
In addition, taking proactive financial steps can help to ensure that you don’t get to a place where you have to skip meals or forego medical care to make ends meet. Here are three ways to allocate your paycheck to build more financial security.
- Pay your bills on time: This might sound obvious, but getting into the habit of paying your bills on time rather than spending the money on something else can help you avoid major problems down the road. Paying your bills late can lead to additional fees that will only put you further behind financially.
- Start an emergency fund: This is one of the most important money moves you can make because it gives you financial security to navigate unexpected expenses or losses of income. Most financial experts recommend saving at least three to six months’ worth of expenses in your emergency fund.
- Set up automatic savings: Automating your savings lets you build wealth without even having to think about it. For the biggest return, put your money into a high-yield savings account.
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