55% of Americans Say Their Finances Are Getting Worse. These Steps Can Help.

Feeling the pressure of rising costs? You’re not alone — and there are concrete steps you can take right now.

Multiple recently released studies show rising debt levels, financial anxiety, and how Americans are adjusting their budgeting and spending in response.

🔴 The New York Federal Reserve’s latest report shows household debt (including mortgages) has increased $18 billion to $18.8 trillion.

🔴 Gallup finds 31% say inflation and high prices are their top financial problems. And more than half (55%) feel their finances are getting worse.

🔴 JD Power shows half of Americans are “buying fewer items to stay within a budget,” and “38% found new ways to earn extra income.”

Those three studies show how resilient Americans take control when economic events out of their control impact their finances. Here we explore reducing costs, paying down debt, and strengthening credit.

✂️ Cutting back proves to help

JD Power found that 68% of Americans are classified as financially unhealthy, and 25% say they are using savings just to get by day to day. But the same data shows the people pulling ahead are taking concrete action: buying fewer items, sticking to budgets, and finding extra income.

A written budget, even a rough one, is the single most effective tool for finding money you didn’t know you had. Start by tracking every expense for one month.

🛒 Your grocery bill is one of your biggest levers

Grocery prices spiked 11.4% in 2022 and have kept climbing since. The USDA projects food-at-home prices will rise another 2.4% in 2026, with beef and veal, sugar and sweets, and nonalcoholic beverages seeing the sharpest increases.

Egg prices are projected to fall nearly 30% and dairy is also expected to decline. So shop around those categories.

Swap beef for chicken or eggs on two to three nights a week and the savings add up fast. Buy store-brand for staples like sugar, pasta, and canned goods where the price gap is widest.

🎯  High-interest debt should be your first target

Americans are carrying $1.25 trillion in credit card debt, according to the New York Fed. And with average card rates now above 20%, minimum payments barely cover the interest.

Gallup found 28% of Americans worry about making those minimums, up 11 percentage points since 2021, which means millions are treading water without making real progress on the balance.

Once you’ve cut spending and freed up even $50-100 a month, direct it to your highest-rate balance first. This minimizes total interest paid. If your balances are too much to handle on your own, call a nonprofit credit counseling agency. You may qualify for a debt management program, which can reduce your interest rates and consolidate your payments into one monthly payment.

📈 Strengthening credit doesn’t require paying everything off

Credit utilization — how much of your available credit you’re using — accounts for about 30% of your credit score. Paying down $500 on a $1,500 balance can noticeably improve your score within one billing cycle.

A stronger credit score means better terms if you need to refinance, take out a loan, or even negotiate a lower rate on an existing card. All of which directly reduce what debt costs you going forward.

Small, consistent changes compound over time. Lower your grocery bill this month, put an extra $50 toward debt next month, and check your credit utilization the month after. That’s the roadmap. Each step builds on the last, and by the end of the year the progress adds up in ways that matter.