Overview
- New York Fed analysis finds high-income households earning over $125,000 drove most real retail spending gains since early 2023, with about 7.6% cumulative growth through March 2026.
- The study links the split to wealth effects, with the top 1% posting more than a 25% jump in real net worth since 2023 as financial assets climbed.
- Real spending has recently turned negative across all income groups, yet the gap between high- and low-income households remains wide.
- TransUnion reports a more polarized credit landscape with more superprime and more subprime borrowers, and average credit card balances at $6,519 are up 2.3% year over year.
- Lower earners face higher inflation, especially from gas, which leaves thinner budgets and pushes more households to rely on credit.