The bane of rising costs has affected almost every country in the world. The 2022 financial crisis had hit pockets hard, and not just of the working class. Now, according to CNBC, as of September 2022, 63% of Americans live paycheck to paycheck, leaving little room for investments, either stocks or crypto.
CNBC has cited a recent LendingClub Report for the data. As per the report, in March, the number of people living paycheck to paycheck was at a historic high of 64%, as of September, the number has only decreased by 1%. To compare, a year ago, the number was close to 57%.
According to Anuj Nayar, financial health officer at LendingClub,
“Consumers are not able to keep up with the pace that inflation is increasing”
Additionally, Nayar said that simply being employed was not enough, as wage growth and inflation are not at the same pace.
According to the Bureau of Labor Statistics, real average hourly earnings decreased 0.1% for the month and are down 3% from a year ago.
Furthermore, what’s even more pressing is that high-income individuals are also reportedly facing hardships. As per the report, 49% of individuals earning six-figure salaries were living paycheck to paycheck. This number is a big jump from last year’s 38%.
How is crypto affected?
It goes without saying that living paycheck to paycheck does not allow a lot of room for investments. Hence, it directly affects the crypto and stock markets.
Nonetheless, the number of Americans who have a stake in crypto increased by 125%, according to Finbold. By the summer of 2022, 18% of Americans, up from 8% in 2020, had made investments in various cryptocurrencies. Although interest in the sector declined due to the bear market, there is still a lot of buzz around the sector.
Moreover, young Americans are still very enthusiastic about crypto. According to a survey by the Bank of America, 75% of young Americans believe in crypto for wealth generation.
At press time, the global crypto market cap stood at $1.07 trillion, down by 2.4% in the last 24 hours.