Inflation eclipses fears of recession as top concern for Americans this summer

  • 51% of Americans’ financial situation has worsened since the start of the pandemic, yet nearly 30% of Americans plan to spend more this summer 
  • Nearly one-third of Americans have taken on debt in the last six months as a result of rising gas prices
  • 80% of Americans are concerned about the current economy, yet few fear a recession

Inflation remains at a near 40-year high, which means many consumers are feeling the financial pinch each time they open their wallets. That includes everything from groceries and housing to airline tickets and gas prices. With summer on the horizon and many people looking to travel, things could worsen for Americans, many of whom are already struggling financially.  

According to a study conducted by Qualtrics on behalf of Credit Karma among over 1,000 U.S. adults, more than half of Americans’ financial situation has worsened since the start of the pandemic (51%), and younger generations may be suffering the most. Nearly 60% of Gen Z and millennials say their financial situation has worsened compared to 45% of Boomers, respondents aged 55 and above. 

Despite reports of finances on the decline, nearly 30% of Americans plan to spend more this summer, with nearly a quarter of those planning to spend more than $1,000 over their typical budget (22%). Beyond inflation and record gas prices, factors driving up consumer spending include a desire to make up for lost time (33%) and take advantage of life returning to normal (38%), as well as a fear of missing out (FOMO) (25%).

Making up for lost time? That will cost you. 

According to the study, one-third of Americans are spending more today than they did prior to the pandemic because of a desire to make up for lost time. This was especially true among younger generations, with 52% of Gen Z and 46% of millennials reportedly doing so. 

Among those who are spending more now, the majority are doing so to pay for groceries (75%), gas (64%) and bills, including electricity and cable (50%). Here’s a closer look at the areas in which consumers are spending more: 

Which of the following are you spending more on today compared to before the pandemic? Select all that apply.
Groceries 75%
Bills (electricity, cable, etc.)50%
Dining out40%
Rent 33%
Personal care (nail, hair, grooming, etc.)28%
Personal travel/ vacation26%
Commuting to work 22%
Entertainment (concerts, sporting events, etc.)21%
Child care14%
*Among those who are spending more today than they were prior to the pandemic 

Summer of spend

Inflation be damned, nearly 40% of Americans say they’re willing to spend more money this summer as a result of the COVID-19 pandemic limiting their ability to do most things over the last two years. The top categories in which consumers expect to spend the most this summer include dining out (45%) and weekend trips (41%), as well as family or pet related expenses (32%) and new clothing (31%).

The combination of making up for lost time and taking advantage of what feels like a “return to normal” may be leading consumers to spend money they don’t have out of a fear of missing out. 

Cue the FOMO 

A quarter of Americans say feelings of FOMO have caused them to spend money they didn’t have on activities and events, with younger generations affected the most. According to the study, 43% of Gen Z and 37% of millennials say they have spent money they didn’t have on events or activities out of a fear of missing out. Factor in inflation, rising gas prices and increased interest rates and consumers’ finances could be in trouble. 

Pay attention to inflation 

More than three-quarters of Americans say they’re spending more in 2022 as a result of inflation. Surprisingly, Gen Z was the least likely of any generation to report inflation driving up their spending (63%). This could suggest inflation is having less of an impact on younger folks or could otherwise indicate that Gen Z is not monitoring the impact of inflation on their daily spend as closely as older generations. 

This checks out. Nearly three-quarters of Americans say they pay attention to how inflation affects their daily spending (74%). However, Gen Z was least likely to report that they’re paying attention, 65% compared to nearly 80% for Boomers. 

How about them gas prices?

The price of gasoline in the U.S. hit an all-time high this month, now averaging about $4.52 for a gallon of regular gas. To counteract rising gas prices, many Americans have had to take on debt and others have been forced to sacrifice certain living expenses, including necessities. According to the study, 30% of Americans have had to take on debt in the last six months as a result of the increase in gas prices. Meanwhile, 28% of Americans have had to sacrifice groceries. 

Some rely on side gigs to make ends meet 

Consumers have very few options to combat inflation, especially those who were already struggling to make ends meet before prices began to rise. As a result, many Americans have taken on additional work to supplement their income. According to the survey, 35% of Americans have a side gig, or a job they do outside of their day job to earn additional income. Of those, 67% said they took on the additional work to cover the increasing cost of living. 

“Inflation has broadened in the last few months, reaching nearly every aspect of consumers’ lives, including everyday necessities, like groceries and rent, and nonessentials, like airfare and dining out. As we enter into the summer months, a time when most people tend to spend more, it’s likely consumers will start to feel the financial pinch,” said Colleen McCreary. “The best thing consumers can do is look for areas in their lives where they can consume less. If they’re unable to find cost savings that way, consider looking for opportunities to substitute goods and activities for cheaper alternatives. That could be at the grocery store or when considering where to travel this summer. Lastly, keep a close eye on your balance sheet and take note of the areas where you’re spending is going up. This will help you course correct, if needed.”


This survey was conducted online within the United States by Qualtrics on behalf of Credit Karma from May 6-10, 2022 among 1,036 U.S. adults ages 18 and older.