February 18, 2026
Kzenon/Depositphotos.com
Should US Consumers Be as Upbeat Over Their Finances as Data Suggests?
In a new report issued by Snap Finance titled “Closing the Credit Gap: 2026 Outlook Study,” a decidedly mixed bag of data points were presented for analysis — not least of which concerned the financial well-being of the U.S. consumer base.
Some top-line results of the study indicate that about two-thirds (66%) of respondents had delayed a purchase or service costing $300+ last year due to their financial situation. Further, that rate soared to an overwhelming majority of 86% for those who held credit scores of 670 and under, and three-quarters (75%) of Gen X respondents writ large answered the same. The most frequently deferred expenditures hinged around auto repairs, medical and dental care, and major appliance repairs.
Amid wider discussions of an emerging K-shaped economy separating the economic haves from the have-nots stateside, the study data reinforced this point, with authors writing, “In 2025, consumers with credit challenges reported significantly higher levels of instability compared to the general population. One in four (25%) of all consumers described their current financial situation as unstable or very unstable — increasing to 41% of those with lower credit scores and 54% of those with household incomes of $50K or less.”
Further data points pulled from Snap Finance study:
- More than four-fifths (83%) of those with a credit score below 670 said they live paycheck to paycheck: Yet, of this group, nearly two-thirds (59%) indicated a belief that they had done a good job in managing their personal finances in 2025 — perhaps signaling macroeconomic problems beyond their control. The same percentage described their debt as “manageable.” A slightly higher cohort of all respondents (62%) also stated that they lived check to check.
- A majority expect finances to improve in 2026: In the all-consumers group, more than half (53%) stated that they expect their financial situation to get better, versus just 12% who anticipate it worsening.
- Concerns persist, however: The primary threats to fiscal health cited by U.S. consumers are persistent inflationary pressure (67%), an unanticipated significant expense (48%), and potential job loss (44%). Gen Xers were most concerned, in general (citing inflation, primarily).
Financing Being Used as a Way To ‘Make Ends Meet’
Per the study authors, Americans continue to use credit vehicles as a method of making ends meet — particularly millennials and those with lower credit scores.
“Those with lower credit scores are the top users of most types of financing, including 53% who use store-specific credit cards and 47% who use pay-in-4 financing. Millennials are also top users of financing, including store credit cards (58%), pay-in-4 (41%), lease-to-own financing (28%), and installment loans (22%),” they wrote, noting that more conventional financing in the form of general-purpose credit cards were preferred by boomers and those with high credit scores.
BrainTrust
Mark Ryski
Founder, CEO & Author, HeadCount Corporation
Neil Saunders
Managing Director, GlobalData
Cathy Hotka
Principal, Cathy Hotka & Associates
Recent Discussions
Discussion Questions
Should American consumers be as rosy over their finances as this data suggests? Why or why not? How accurate do you believe the data to be?
How do you interpret the following consumer data points: so many living check to check, unable to absorb a $300 expenditure — yet a majority expect things to improve this year, and many are reliant on payment plans and BNPL?
Poll
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There is a lot to unpack here. First, concern around the trajectory of the economy is fueled by uncertainty. With so much noise swirling around, broader economic sentiment readings remain depressed. By comparison, personal finance readings are more positive, as consumers feel more in control of their own situations. However, this does not mean that all is well. Away from perception, hard data shows rising debt, rising defaults, and an increase in coping behaviors like trading down or buying less. That suggests that sentiment is still very mixed and changeable.
There are a lot of mixed signals in the economic and other data being presented. How consumers feel is very personal. High income earners are feeling terrific about things and their stock portfolios reflect that; lower income individuals are facing some pretty extreme challenges. Unfortunately, in today’s climate, it’s hard to get a real bead on whether consumers are better or worse off. The truth is each consumer knows their own position.
While the top 10% are doing well, the condition of the other 90% should be cause for alarm. We cannot have a healthy retail environment when people have to use BNPL to buy dinner. How far we have fallen from the days of the one-income household.
Those who are doing well, should, the many who aren’t, shouldn’t. Sheesh…talk about an overly broad question!
There’s no way to read this article, along with everything else I read on a daily basis, and then start using words like ‘rosy’ or ‘upbeat’ in describing the financial prospects for 2026. Having said that, I do understand that some people might want to look at 2026 through an upbeat lens. If you are living paycheck to paycheck or using BNPL to buy groceries, do you really want to project that lifestyle far into the future? No, of course not. So expressing a little hope and (false) optimism is understandable. But if I am a retailer managing my Open-To-Buy for the balance of the year, the words ‘rosy’ and ‘upbeat’ would have absolutely no role. I might include words like ‘cautious’, and ‘guarded’ and ‘nervous’ as the umbrella for the OTB math.
Negative Nelly’s will not like what I am about to say, but the truth is that the U.S. economy is doing very well.
By the end of the year, the United States economy will be even stronger than it is at present.
Inflation has finally been brought under control after four years of chaos. This year, interest rates will decrease. With new factories opening left and right, and middle class jobs in the private sector (instead of government) multiplying rapidly, our country exports more than imports.
There is a crazy rise in the stock market, as well as an escalation in 401Ks. As a result of our energy independence, our gas prices are half what they were two or three years ago. Mainstream media enjoys raining on every parade, especially now that the current administration is in office, but even they have difficulty finding negativity except for the high prices in stores, which are high due to the chaos caused by the past four years of economic mismanagement.
Having said that, if you work in the private sector, the government isn’t responsible for your income.
Similarly to any other period in history, some people are experiencing great success and buying more consumer goods than ever before.
Other people, mostly for personal reasons, are struggling. There is never a time when everyone is doing well. However, ambitious Americans have the opportunity to benefit from these excellent economic times.
Hmm, gas prices are half of what they were two or three years ago? 2023: $3.50, 2024: $3.07. 2025: $3.10. 2026 so far: $3.00+/-.
401K’s do not buy groceries, or make rent payments, or mortgage payments, or car payments. According to ChatGPT there were 3.44 million jobs added in 2023. In 2024 “growth continues but slows.” There were multiple months of 250,000+ nonfarm payroll gains. 2025…”final data show the US economy added only about 181,000 jobs for all of 2025, a dramatic downward revisiion from earlier estimates.” It’s very hard to see how any of that would suggest we are sauntering into 2026 under an umbrella of ‘excellent economic times’.
I think the data reflects a real sentiment, but not necessarily a fully grounded reality. Consumers often operate on a forward-looking mindset — optimism about future improvement can coexist with present financial strain. Right now, we’re seeing a disconnect where many households are still living paycheck to paycheck, struggling to absorb relatively small unexpected expenses, and increasingly relying on payment plans or BNPL — yet they remain hopeful that conditions will improve. That optimism may be less about current fundamentals and more about expectation management and a belief that economic pressures are temporary.
From my perspective, there’s a growing risk that consumers are operating in a mindset that hasn’t fully caught up with underlying economic realities. Inflationary pressures, evolving public policy, and signs of softening in employment trends suggest that conditions may not be improving as quickly as sentiment implies. If those pressures persist or intensify, we could see a delayed recalibration in consumer behavior — one in which spending patterns begin to reflect the constraints already visible in household balance sheets.
The contradiction in the data — financial fragility paired with optimism — is important for retailers to understand. It suggests that while consumers may continue to spend in the near term, that spending could become more selective, more value-driven, and more sensitive to disruption as the year unfolds. As we move closer to mid-term elections and broader economic narratives sharpen, there’s a reasonable chance that sentiment and reality begin to converge. Retailers that prepare for that shift — balancing value, flexibility, and clear communication — will be better positioned if and when consumer confidence begins to recalibrate.
As Cathy Hotka says, the condition of the 90% should alarm not just retailers but the country as a whole. A solid middle class drives any national economy, and America’s middle class is not solid economically, by any means.
Both the country and people are facing a situation that will lead to disaster. When interest payments grow faster than income, the situation becomes unsustainable. While the country isn’t quite there yet, too many consumers are.
Considering the current 2026 Bureau of Labor Statistics data, the 2025 U.S. job growth was significantly revised downward from an estimated 584,000 to just 181,000, or roughly 15,000 jobs per month. This marks one of the largest annual downward revisions in decades, with roughly 898,000 fewer jobs added between April 2024 and March 2025 than initially reported. The top of the “K” may be winning, but the important part certainly is not.
Optimism and fragility are not opposites in retail. We see them coexisting every day on the sales floor. Customers feel they are managing well simply because they are keeping the lights on, even if that confidence is built on extended payment terms rather than actual wage growth.
What often gets missed is that payment plans and delayed purchases are not signals of reckless behavior. They are tools customers use to smooth out volatility. When an appliance fails or a medical bill hits, people solve the problem in front of them. They are not thinking about macro data. They are thinking about getting through the month without falling behind. That can feel responsible and optimistic at the same time.
The risk for operators is mistaking this adaptation for enduring resilience. While consumers remain hopeful, their margin for error is incredibly thin. Retailers must build strategies around the reality of daily cash flow and earn trust by delivering reliability when the customer has very little slack.
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There is a lot to unpack here. First, concern around the trajectory of the economy is fueled by uncertainty. With so much noise swirling around, broader economic sentiment readings remain depressed. By comparison, personal finance readings are more positive, as consumers feel more in control of their own situations. However, this does not mean that all is well. Away from perception, hard data shows rising debt, rising defaults, and an increase in coping behaviors like trading down or buying less. That suggests that sentiment is still very mixed and changeable.
There are a lot of mixed signals in the economic and other data being presented. How consumers feel is very personal. High income earners are feeling terrific about things and their stock portfolios reflect that; lower income individuals are facing some pretty extreme challenges. Unfortunately, in today’s climate, it’s hard to get a real bead on whether consumers are better or worse off. The truth is each consumer knows their own position.
While the top 10% are doing well, the condition of the other 90% should be cause for alarm. We cannot have a healthy retail environment when people have to use BNPL to buy dinner. How far we have fallen from the days of the one-income household.
Those who are doing well, should, the many who aren’t, shouldn’t. Sheesh…talk about an overly broad question!
There’s no way to read this article, along with everything else I read on a daily basis, and then start using words like ‘rosy’ or ‘upbeat’ in describing the financial prospects for 2026. Having said that, I do understand that some people might want to look at 2026 through an upbeat lens. If you are living paycheck to paycheck or using BNPL to buy groceries, do you really want to project that lifestyle far into the future? No, of course not. So expressing a little hope and (false) optimism is understandable. But if I am a retailer managing my Open-To-Buy for the balance of the year, the words ‘rosy’ and ‘upbeat’ would have absolutely no role. I might include words like ‘cautious’, and ‘guarded’ and ‘nervous’ as the umbrella for the OTB math.
Negative Nelly’s will not like what I am about to say, but the truth is that the U.S. economy is doing very well.
By the end of the year, the United States economy will be even stronger than it is at present.
Inflation has finally been brought under control after four years of chaos. This year, interest rates will decrease. With new factories opening left and right, and middle class jobs in the private sector (instead of government) multiplying rapidly, our country exports more than imports.
There is a crazy rise in the stock market, as well as an escalation in 401Ks. As a result of our energy independence, our gas prices are half what they were two or three years ago. Mainstream media enjoys raining on every parade, especially now that the current administration is in office, but even they have difficulty finding negativity except for the high prices in stores, which are high due to the chaos caused by the past four years of economic mismanagement.
Having said that, if you work in the private sector, the government isn’t responsible for your income.
Similarly to any other period in history, some people are experiencing great success and buying more consumer goods than ever before.
Other people, mostly for personal reasons, are struggling. There is never a time when everyone is doing well. However, ambitious Americans have the opportunity to benefit from these excellent economic times.
Hmm, gas prices are half of what they were two or three years ago? 2023: $3.50, 2024: $3.07. 2025: $3.10. 2026 so far: $3.00+/-.
401K’s do not buy groceries, or make rent payments, or mortgage payments, or car payments. According to ChatGPT there were 3.44 million jobs added in 2023. In 2024 “growth continues but slows.” There were multiple months of 250,000+ nonfarm payroll gains. 2025…”final data show the US economy added only about 181,000 jobs for all of 2025, a dramatic downward revisiion from earlier estimates.” It’s very hard to see how any of that would suggest we are sauntering into 2026 under an umbrella of ‘excellent economic times’.
I think the data reflects a real sentiment, but not necessarily a fully grounded reality. Consumers often operate on a forward-looking mindset — optimism about future improvement can coexist with present financial strain. Right now, we’re seeing a disconnect where many households are still living paycheck to paycheck, struggling to absorb relatively small unexpected expenses, and increasingly relying on payment plans or BNPL — yet they remain hopeful that conditions will improve. That optimism may be less about current fundamentals and more about expectation management and a belief that economic pressures are temporary.
From my perspective, there’s a growing risk that consumers are operating in a mindset that hasn’t fully caught up with underlying economic realities. Inflationary pressures, evolving public policy, and signs of softening in employment trends suggest that conditions may not be improving as quickly as sentiment implies. If those pressures persist or intensify, we could see a delayed recalibration in consumer behavior — one in which spending patterns begin to reflect the constraints already visible in household balance sheets.
The contradiction in the data — financial fragility paired with optimism — is important for retailers to understand. It suggests that while consumers may continue to spend in the near term, that spending could become more selective, more value-driven, and more sensitive to disruption as the year unfolds. As we move closer to mid-term elections and broader economic narratives sharpen, there’s a reasonable chance that sentiment and reality begin to converge. Retailers that prepare for that shift — balancing value, flexibility, and clear communication — will be better positioned if and when consumer confidence begins to recalibrate.
As Cathy Hotka says, the condition of the 90% should alarm not just retailers but the country as a whole. A solid middle class drives any national economy, and America’s middle class is not solid economically, by any means.
Both the country and people are facing a situation that will lead to disaster. When interest payments grow faster than income, the situation becomes unsustainable. While the country isn’t quite there yet, too many consumers are.
Considering the current 2026 Bureau of Labor Statistics data, the 2025 U.S. job growth was significantly revised downward from an estimated 584,000 to just 181,000, or roughly 15,000 jobs per month. This marks one of the largest annual downward revisions in decades, with roughly 898,000 fewer jobs added between April 2024 and March 2025 than initially reported. The top of the “K” may be winning, but the important part certainly is not.
Optimism and fragility are not opposites in retail. We see them coexisting every day on the sales floor. Customers feel they are managing well simply because they are keeping the lights on, even if that confidence is built on extended payment terms rather than actual wage growth.
What often gets missed is that payment plans and delayed purchases are not signals of reckless behavior. They are tools customers use to smooth out volatility. When an appliance fails or a medical bill hits, people solve the problem in front of them. They are not thinking about macro data. They are thinking about getting through the month without falling behind. That can feel responsible and optimistic at the same time.
The risk for operators is mistaking this adaptation for enduring resilience. While consumers remain hopeful, their margin for error is incredibly thin. Retailers must build strategies around the reality of daily cash flow and earn trust by delivering reliability when the customer has very little slack.