According to a study conducted by Clever, nearly three-quarters of Americans are facing financial struggles, largely due to the ongoing effects of the COVID-19 pandemic. The study found that 44% of working families are living paycheck-to-paycheck, with this number rising to 75% during the pandemic. Additionally, many Americans have had to dip into their emergency savings to cover bills and basic costs, while others have no savings at all.
Lowering the cost of living was identified as the top way for Americans to see their finances recover, with 74% of respondents stating that reduced expenses like mortgage payments and groceries would help them the most. Another popular solution mentioned was the distribution of more stimulus checks, with 59% of those surveyed believing it would provide temporary financial relief. Lower inflation was also mentioned as a potential benefit, although it was not as highly prioritized.
Despite these financial struggles, there is some positive news. Credit scores in the United States actually increased during the pandemic and have remained steady. The average FICO® credit score currently sits at 718, higher than pre-pandemic levels. This increase can be attributed to factors such as a decline in credit utilization ratios and a decrease in delinquencies on credit reports.
To alleviate financial stress, experts suggest considering low-interest personal loans or debt consolidation options to manage high-interest debts. Platforms like Credible can help individuals compare loan options and find the best rates based on their credit score and history.
Overall, the study highlights the ongoing financial challenges faced by many Americans as a result of the COVID-19 pandemic. While credit scores have improved, a significant portion of the population continues to struggle financially. Lowering basic living costs, providing additional stimulus checks, and addressing inflation are potential solutions that could help individuals regain financial stability.