CFPB reports on consumers’ financial well-being

Federal Issues CFPB Consumer Finance

On December 21, the CFPB released a report discussing the results of its Making Ends Meet survey conducted from January through March 2022, which examined the financial health of U.S. households. Using the results from the survey as well as credit bureau data, the Bureau found that the average financial well-being of U.S. consumers returned to its pre-pandemic level, with increases in income variability and use of high-cost credit products, after a substantial drop in 2021, notwithstanding sharp decreases in average credit debt that generally remained through September 2022. The report also determined that approximately one-third of consumers experienced a “major” medical or dental expense in the preceding year, while similar numbers experienced a major vehicle repair or replacement, a major house or appliance repair, or a cell phone or computer repair or replacement. Additionally, a significant number of consumers experienced reductions in income most often due to unemployment or a drop in hours. The report cautioned that “should an increase in unemployment occur, many households are unprepared for even a relatively brief period of low income.”