Consumer Financial Health Declines as Expenses Remain Elevated

The overall financial health¹  of retail bank customers in the United States declined in May following two consecutive months of improvement as they confront an uncertain economy and persistently high cost of goods. The top reasons cited among those who say they are worried their personal financial condition will worsen in the next three months are inflation, job security, government policies, housing and personal debt.

Financial Health Sags                                                       

After a two-month reprieve, the number of customers who are financially healthy dipped to 32%. This is largely in line with the level observed during the previous 12 months.

For a second consecutive month, 70% of bank customers said the cost of goods is increasing faster than their income. That percentage dipped slightly among healthy (57%) and overextended (58%) customers but rose among vulnerable (79%) and stressed (84%) customers. 

Recession Fears Slightly Tamed

Despite a decline in overall financial health, the number of bank customers who believe their future financial health is at risk of getting worse in the next three months has dipped slightly. Overall, 41% of customers think their finances are at risk, a 3-percentage point decrease. Stressed customers are the most concerned (46%).

When asked what they are most worried about in the next three months, cost of living expenses still topped the list, followed by managing household costs. Interestingly, concerns about the stock market declined 5 percentage points (22%).

Wait and See

In the current economic environment, it’s becoming increasingly difficult to read the tea leaves. But even as topline inflation rates decline and economists continue to disagree on the likelihood of a recession, it’s clear that household expenses and the future of the economy are still very much front-of-mind for customers.

For banks looking to help customers navigate these uncertain times, building a relationship and understanding what each customer values is key. Not all customers will have the same fears or needs, and they’ll require an individualized approach based on their finances, age, future plans, and a host of other variables. Banks that can cater to these specialized needs will build valuable relationships that will last beyond this period of volatility.

Find out More

This Banking and Payments Intelligence Report is based on responses from 4,000 retail bank customers nationwide and was fielded in May 2025. It was authored by Jennifer White, senior director of banking and payments intelligence at JD Power. Please contact us at the numbers below to connect with Ms. White or to learn more about the underlying research.

Media Contacts
Brian Jaklitsch; East Coast; 631-584-2200; [email protected]

Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]

[1] JD Power measures the financial health of any consumer as a metric combining their spending/savings ratio, creditworthiness, and safety net items like insurance coverage. Consumers are placed on a continuum from healthy to vulnerable.