Many Americans Who Pay Bills on Time Still Spend Like Strained Households

Paying bills on time does not mean a customer is relaxed about money. A September survey by PYMNTS Intelligence found that 41% of U.S. adults lived paycheck to paycheck but kept up with their bills. Their shopping habits look more like those of people who struggle than those who have room to spare.

What the survey found

The survey asked 2,487 U.S. adults about 22 categories of spending. Over the previous year, people living paycheck to paycheck while keeping up with bills bought from an average of 1.9 optional categories. Those who struggled to pay bills averaged 1.6. Those who did not live paycheck to paycheck averaged 2.5. Another 25% of adults lived paycheck to paycheck and struggled to pay their bills.

Similar views, different habits

The groups agreed more on what counts as optional than on what they actually bought. Keeping-up households called an average of 10.5 of the 22 categories discretionary. Households not living paycheck to paycheck said 10.1. A purchase counted as discretionary only if the buyer considered that category optional.

Among people who made optional purchases, 40% of the keeping-up group rated at least one category a notable or major monthly expense. The share was also 40% for those struggling to pay bills, and 34% for those not living paycheck to paycheck.

Subscriptions go first

Subscriptions show the gap clearly. Among buyers who saw their subscriptions as optional, 57% of the keeping-up group would make them one of their first cuts. That is three points below the share among those struggling to pay bills. It is 18 points above the share among those not living paycheck to paycheck.

Reasons for cutting were similar across all groups. Between 49% and 54% said they wanted the item more than they needed it. Another 43% to 44% said it was easy to stop.

What people protect

Mortgage or homeownership costs were the expense people in all three groups most often said they would protect longest. About 27% of the keeping-up group named it, and the share was about the same for those not living paycheck to paycheck.

Why it matters for business

A customer who pays on time can still treat your product as one of the first things to go. The survey does not say how fast cuts would happen or which products would suffer most. It does suggest that on-time payments are a weak sign of how secure a customer feels.