Why Americans Feel So Poor | CNBC Marathon

CNBC Marathon explores why American workers’ budgets feel so stretched.

The middle class was once a symbol of the American dream. It meant financial security and an opportunity for a better future. But that portrait of the American middle class is quite different today. A survey in 2018 found that a third of middle-income adults don’t have as much as $400 to cover an unexpected expense. And while the middle-class lifestyle grows more expensive and uncertain, it’s also moving beyond the reach of younger generations.

Maybe the cause is related to American workers’ income? When adjusted for inflation, wages have remained virtually unchanged over the last 50 years, with workers today earning just 12 cents more than they did in 1972. And with inflation at its highest since 1971, Americans are feeling the pain of slow wage growth. Two-thirds of American workers said that inflation has outpaced any salary gains made in the past year. But some economists argue that the concept is merely a myth politicians use to promote their careers. So, how real is wage stagnation in America today and what does it mean for American workers?

And CNBC takes a look at why Americans have so much debt. Household debt in America reached $16.15 trillion during the second quarter of 2022. And debt is likely to grow even further due to soaring inflation. 43% of Americans are expected to add even more debt within the next six months. So why are so many Americans in debt today and what impact does it have on the U.S. economy?

Money can be stressful in the U.S. Americans are more worried than ever about money and the economy. In a survey by the American Psychological Association, 87% of Americans said inflation and the rising costs of everyday expenses were causing them stress. Roughly two out of every five U.S. adults said money is negatively impacting their mental health, according to Bankrate. Watch the video above to learn what’s causing this anxiety around money and how Americans can deal with their stress.

CNBC Marathon brings together the best of CNBC’s coverage of American workers’ financial woes.

Chapters:
00:35 Introduction
00:37 Why The Middle-Class Is Disappearing (Published February 2022)
13:20 Why Americans Aren’t Paid Enough (Published July 2022)
27:34 Why Americans Are Drowning In Debt (Published August 2022)
42:01 Why Americans Are So Stressed About Money (Published May 2022)

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Why Americans Feel So Poor | CNBC Marathon

[vydg]

Being poor is one thing but being poor and working 75+ hours is another thing.

[Bloated_Tony_Danza]

It's being poor and surrounded by money that really messes with your mind. I'm working to be an electrician (~3 years now) and I am absolutely surrounded by EXTREME wealth. wiring houses that sell for $8+ million dollars, installing Tesla car chargers, multiple guest bedrooms, 9 bathrooms, etc and I see absolutely no way of having anything like these people. My work gets harder, my hours get longer, I know more than I did in the past, and I'm still stuck at like $20 an hour. It feels bad working to build a townhouse who's monthly rent is more than twice my monthly income...

[rannyorton]

The average person has never been so poor. Millions of families are struggling financially as living expenses hit the highest levels in more than four decades. Over 60% of our country lives paycheck to paycheck and about 40% earns poverty wages. Even after working all their lives, more than a quarter of older people have no savings and many believe they will never be able to retire in dignity, while around 55% of elderly people try to survive on an income of less than 25, 000 a year.

[barttfisher]

Debt is a burden on a good day, but with inflation, I feel like there’s a weight on me getting heavier by the month. My income isn't keeping up, so those monthly payments are squeezing my budget even tighter.

[BobbyCoggins]

Something has definitely changed. A generation ago, one wage earner could easily support a family of two to four children. Now, two wage earners are hard-pressed to support a family with one child.

[arun]

It's not a feeling, it's an economic reality.

[LucasBenjamin-hvsk]

My greatest concern is how to recover from all these economic and global troubles and stay afloat especially with the political power tussle going on in US.

[kortyEdna]

The 1% of rich Americans think of how to invest their money to increase their wealth during the recession. While the 99% of struggling hard-luck Americans think of how to survive without food and daily necessities in the recession and the coming hyperinflation. I am just about to make my first index fund purchase via vanguard. I intend to invest long term. just getting slightly stuck on how I balance my percentage portfolio between equity vs bonds. Low risk is good for me. Any tips

[inlonging]

Middle class to me means we are stuck paying all the taxes but don’t qualify for any of the benefits. So it’s paycheck to paycheck and all of our paychecks are smaller than they should be, but costs go higher all the time.

[joetalley]

I love their term "squeezed". If you're barely paying your necessities, even if you do make good money, you're poor. They said it themselves that middle class is living check to check. To me living middle class means you can afford to take vacations every so often, and can handle the occasional bump along the road.

[DanielPanuzi]

The only American who won't acknowledge this Administration's failed economic policies is Joe Biden. "Shrink-flation' is the least of our worries compared to rising rents and stagnant wages, but it is an undeniable indicator of how bad our inflation has gotten. I have $100k that i like to invest in a non-retirement account, any advice on that?

[ismaelhall]

If you're a struggling adult still living with your parents there's no shame as long as long as you are helping around. We as a society need to being back the sense of community where everyone helps each other if they can.

[taylorx]

As a younger 30 something, I have been saving all my life and I STILL cannot move out of my parents house. I know many people in my exact situation. Life is tough right now.

[koalafishmutantbird]

Childless, debt free, stress free, and live alone. I lived frugal for years. I’m living better than ever right now.

[BeautifulbyDesign]

How can you be middle class if you can't buy a house, have children due to cost, save money, or pay your mortgage or rent on time? Sounds just like poor people to me.

[MONi_LALA]

The moment I realized we are poor is the moment I asked "why am I paying $1000+ in taxes every month and I got nothing back?!" We are truly struggling and no one is helping.

[oneiljerry]

What bothers me about this situation is the fact that the news and media are all going about a recession which is understandable due to the war and pandemic but still the same media still publish articles about folks in the same economy pulling off hefty 6figure profit(Averg. 200k in barely 8weeks) in this downtrend how is that possible?

[ponzo]

What is rarely mentioned is we worked harder, longer, and better, while going nowhere. Medical insurance is a factor $1850 a month, car insurance $300, taxes, high home prices, and now food is scary high.

[JoeWilmoth-kw]

Overall, 60% of traders think this year would favor stocks, mutual funds, and other equity-based investments, despite Treasury yields and other safer cash-like investments paying big. I’m looking for opportunities in the market that could fetch me $1m ahead of retirement by 2025.

[lonniewayne]

We are suffering. look on the streets. do you see the increase of homeless on the streets. Stop the B.S. middle class is shrinking.