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A recent Federal Reserve report highlights a significant decline in financial well-being, particularly among Black adults, young individuals, and those from low-income backgrounds. While it noted that 73% of American adults surveyed in October felt they were managing financially, this figure marks a decrease from pre-pandemic levels, although it remains unchanged from 2024.
Key Findings
- Demographic Variations: Financial stability was notably higher among certain demographics:
- College Graduates: 86%
- Asian Adults: 82%
- High Earners (over $100,000): 91%
However, only 60% of Black Americans reported feeling financially secure, a drop from 65% the previous year. Younger adults (18-29) also fared poorly, with only 63% indicating they were "doing OK."
Challenges Faced by Young Adults
The report attributes part of the financial struggles experienced by younger adults to a challenging job market. The 2025 payroll growth was minimal, and unemployment rates for recent college graduates have risen. A notable trend is the increasing number of individuals under 30 living with their parents; this statistic stands at 49%, an increase of 12 percentage points since 2019. Furthermore, 15% of young adults reported they were not working due to difficulties in job searches, a figure three times greater than that for adults over 30.
Perception of Financial Situations
The financial worries of lower-income and younger Americans were exacerbated by rising costs. Among adults earning below $50,000, 66% cited price increases as a primary concern, in contrast to just 42% of those making above $100,000. The median rent stabilised at $1,200, yet a greater number of renters reported difficulties in meeting their housing bills in the past year, particularly among low-income groups.
Despite these challenges, the overall percentage of adults indicating that price hikes were a major or minor concern remained unchanged. Nevertheless, anxiety surrounding job stability increased, with the share of Americans rating the national economy as "good" or "excellent" declining to 26%. This is an improvement compared to 18% in 2022 but substantially less than the 50% positivity rate reported in 2019.
Declining Economic Sentiment
The report also noted decreased favourable perceptions of local and national economies compared to the previous year. These sentiments remain significantly lower than pre-pandemic levels, suggesting a persistent struggle for many sectors of the population.
In summary, while a majority of Americans reported financial stability, significant disparities remain, particularly among younger adults, Black Americans, and low-income individuals. Ongoing economic pressures, including rising costs and a stagnant job market, contribute to these disparities, highlighting the need for ongoing support and policy adjustments to address these challenges.
