Majority of Americans Cite Rising Cost of Living as Barrier to Better Life

Americans may seem increasingly divided on beliefs and values, but in a new survey of more than 30,000 adults from across the country spanning generations and economic classes, a majority of Americans agree there’s a significant barrier to achieving a better life: the rising cost of living. When asked to describe what a better life in three to five years would look like, 60% of Americans said they wanted greater financial security, according to a survey that was conducted by the McKinsey Institute for Economic Mobility and the WK Kellogg Foundation in mid-April. In interviews that accompanied the survey, respondents often defined financial security as being able to afford basic necessities without worry. “A better life for me and my family would look like being able to buy a home, and being able to afford all the basic necessities, rent, utilities, car, food, healthcare – as well as being able to have enough left over to save for the future for retirement and vacations,” said a 35-year-old respondent from Dearborn Heights, Michigan. Though it may appear to be a simple goal, many Americans believe it’s out of reach. Forty per cent of respondents described themselves as either “getting by but financially vulnerable” or “struggling to meet basic needs”. Groceries and food costs in particular are causing financial distress, with 90% of respondents listing it as their top cost-of-living concern, followed by housing, transportation and healthcare. One survey respondent, a 49-year-old father in Philadelphia, said that success to him was not about extravagant living, rather it was being able to afford his child’s field trips for school or help a family member struggling with their bills. “I just want to be comfortable,” he said. The survey is the latest illustration of how the rising cost of living is the defining challenge for many Americans today. Between higher gas prices, growing electricity bills and a housing market that feels out of reach, many everyday expenses have turned into everyday frustrations for Americans whose paychecks aren’t keeping up with rising inflation. A recent Harris poll that found 95% of Americans believe the country is undergoing an affordability crisis. This experience seems out of step with other parts of the economy, like the US stock market reaching record highs and the seemingly unstoppable rise of AI investment, that are growing. “While we spend a lot of time discussing some of these macroeconomic indicators – from the jobs report, to quarterly GDP growth, to what’s happening with interest rates – they alone can’t help us understand how people are actually experiencing the economy in their day-to-day lives,” said JP Julien, a partner at McKinsey involved in the research, during a news briefing. While Americans largely agreed that affordability was a key barrier to achieving a better quality of life, they diverged on what needs to be improved. Rural respondents were likely to say they needed better jobs and career pathways, while urban respondents said they wanted to see more affordable housing and improved safety. A majority (60%) of respondents said local, state and federal government was responsible for helping people get ahead – 20% more than other institutions including faith organizations, banks, non-profits and schooling systems. But only 30% reported that government institutions have been helpful. Instead, respondents ranked friends and family as the top group helping them get ahead, followed by employers. With this gap in support from the government and employers, community connectedness was a key indicator of how respondents felt more broadly about their outlook. Respondents who said they felt strongly connected to their communities were more than twice as likely to say they were in control of their lives and future and nearly four times as likely to say their lives had “momentum”. Only one-third of respondents, however, reported feeling this strong sense of community. “We’re not too connected with our community and neighborhood,” said a 61-year-old respondent from Los Angeles. “There are a few people that we know, but for the most part, most people keep to themselves.”