Inflation is taking its toll on people’s emergency funds. The share of workers who say they are living paycheck-to-paycheck has surged among middle- to high-income earners — 63% and 49%, respectively — up from 57% and 38%, respectively, a year ago, according to an independent survey of almost 4,000 workers released this week by online loan specialist LendingTree. Overall, 65% percent of employed consumers were living paycheck-to-paycheck in September 2022 — up from 60% a year ago.
Meanwhile, the personal savings rate — savings as a percentage of disposable income — fell to 3.3% in the third quarter from 3.4% in the prior quarter, the government said Thursday, the lowest level since the Great Recession 8th. Adjusted for inflation, savings are down 88% from their 2020 peak and 61% lower than pre-pandemic. (Personal savings hit $629 billion in the second quarter of 2022, down from $1.41 trillion in the second quarter of 2019.) Millions of Americans face rising prices on essential goods and services such as food and rent as their savings are drying up after a post-pandemic spending splurge. On Wednesday, Kraft Heinz Co.
said its third-quarter prices were 15.4 percentage points higher than a year before. National retail sales rose 8.2% on the year in September. “There has certainly been some pent-up demand from the pandemic,” said …