I was once sharing a stage with an economist at an executive summit. He closed his presentation with a forecast so bleak he suggested that by the 2030s, people's adult children would move back home and murder them in their sleep. He added that he came from the Austrian school of economics and didn't much care what people thought — only what they did. Then I had to follow him. As the futurist in the room, I am not always the cheerful one. But give me a chance to follow an economist, and I look like sunshine and roses.
Here's my point: the data on how consumers are behaving is genuinely important. But the data on how consumers are feeling matters just as much. And right now, those two things are telling somewhat different stories.
Better Off But Not Well Off
Each year, Ipsos asks Americans to rate the year they just had, and to project how the next one will go. There's a consistent pattern: we rate the year ahead higher than the year behind. We set ourselves up for disappointment. People gave last year exactly the rating it deserved — somewhere between a 6 and a 7 — and then turned around and said this year would be better.
Higher-income Americans feel more optimistic than those below them, but not by as much as you might expect. And they are notably more pessimistic about the world around them than they are about their own immediate circumstances. The further we get from things we personally control — from my family, to my job, to my community, to the country — the worse we feel about it.
What this gives us is a phrase I keep coming back to: higher-income Americans feel better off, but not well off. That is a genuinely interesting place to be.
The 41% Statistic
In recent waves of the Ipsos US Consumer Tracker, about 41% of Americans say they have no money left over after paying their monthly bills. That's not a number I'd dismiss as a low-income story — roughly 30% of households making over $100,000 say the same thing. They're spending more, but in many cases getting the same or less for it. Yes, I'm spending more on gasoline. But I'm getting less gasoline, and I can go fewer places.
Across income bands, two New Year's resolutions have consistently ranked at the top: stick to a household budget, and save more money. Not "travel more" or "start a business." Save more. And across all those same income bands, majority of Americans describe themselves as stressed, nervous, or exhausted. Women more so than men, for what should be fairly obvious reasons.
How People Actually Cut Back
When financial pressure builds, people don't cut everything at once. There's a sequence, and it matters for anyone trying to understand where loyalty goes under stress.
First, people cut one-time discretionary expenses — going out to eat is the classic example. Restaurants are expensive and the cost-benefit math is easy to run in your head when you're trying to save money.
Second, they cut recurring subscriptions. This is where the streaming churn patterns show up. People don't necessarily cancel Netflix permanently — they drop one thing, try something else, cancel that, come back to the first one. It's a rotation, not an exit. But brands that have relied on sticky recurring revenue are discovering just how unsticky it can get.
Third, they postpone major purchases. The car that was fine last year is fine for another year. The kitchen renovation waits. These deferrals pile up and eventually create a wave of demand — but the timing is unpredictable.
There's a fourth thing happening at the same time: private label and store brands have gotten better, and branding itself has become a harder sell. For a lot of categories, the trade-off to a store brand has become genuinely easy for people to make. That's a different kind of problem than a temporary budget crunch.
The Vibes Problem
You've probably heard this called the K-shaped economy, or the vibes economy, or the windshield economy — that last one resonates with me because it captures the idea that things feel worse than they are. Wind chill. And consumers aren't wrong exactly — they're processing real uncertainty. Record credit card debt. Prices that haven't come down even when inflation slowed. A world that seems to be generating a new crisis every few weeks.
When we did qualitative research and asked people about their biggest worries, nearly everyone was anxious about some kind of apocalypse — just different ones. Total economic collapse. World War III. The collapse of American democracy. Killer robots (which I mention because it's the dark horse — keep an eye on it). Only about 10% said they were worried about none of these. We gave them an out and they didn't take it.
This isn't irrational panic. It's people trying to price in a lot of real uncertainty at once, in an environment where information is abundant and trust is scarce.
What This Means in Practice
Empathy is a superpower right now. Not performed empathy, not "we understand these are challenging times" copy on a website. Actual understanding of what people are going through and how their goals might be shifting.
A few things I'd flag from the data. People are not giving up on aspirations — they're adjusting timelines. The desire to build wealth, own a home, provide for family: these haven't gone away. What has shifted is confidence in the path, and trust in the institutions that are supposed to help navigate it. That gap between aspiration and confidence is where the opportunity sits for anyone who can show up with clarity, empathy, and a plan that actually connects to where people are.
The human economy isn't the official economy. GDP can be growing while majority of Americans are stressed and exhausted. Consumer spending can be up while people feel like they're falling behind. Both things can be true. The job of a brand, an advisor, or anyone trying to build a lasting relationship with customers is to understand both — the macro data and the human reality underneath it.