• Nearly nine in 10 Americans believe the country is in a full-blown cost-of-living crisis according to a new 5,000-person survey
• Tax refunds have transformed from discretionary windfalls into survival funds, with 73% saying they need the money more than ever
• Half of Gen Z respondents have already relocated because they could not afford where they lived, compared to just 19% of baby boomers

WASHINGTON, D.C. (TDR) — A sweeping national survey of 5,000 Americans has put hard numbers on what millions of households already feel every month — the gap between paychecks and expenses is widening, and the financial cushion that once separated getting by from falling behind has all but disappeared.

The Talker Research poll, commissioned by financial services company Current and conducted between Dec. 17, 2025, and Jan. 5, 2026, found that 87% of respondents believe the United States is experiencing a cost-of-living crisis. More than half — 52% — reported struggling to pay bills like rent on time each month, while an equal share said affording basic necessities like groceries has become a persistent challenge.

The findings arrive as the U.S. economy sends mixed signals. GDP grew at an annualized rate of 4.4% in the third quarter of 2025, the strongest expansion in two years. Consumer spending remains the engine of that growth, accounting for roughly 69% of economic output. Yet the disconnect between macroeconomic indicators and household-level financial stress continues to define the current moment.

Tax Refunds Become Financial Lifelines

Perhaps the survey's most revealing finding is how Americans now view their annual tax refunds. Among the half of respondents expecting a refund this year, 73% said they need it more than ever before. Six in 10 said they need the money earlier than usual just to stay current on obligations.

"Tax refunds are often the biggest checks many Americans receive each year and now more than ever, they are a critical source of liquidity that people are not only counting on, but are in need of earlier than ever."

That assessment came from Erin Bruehl, VP of Communications at Current, which commissioned the study.

"They've become lifelines to pay down debt and avoid missed payments and late fees. With their timing now mattering as much as the size of the refund, it is a clear signal that Americans need partners who can get them access to their money as quickly as possible."

The generational divide is stark. Among Gen Z respondents expecting refunds, 74% said they need the money earlier than ever — compared to just 34% of baby boomers. Where the money goes reinforces the picture: 27% plan to spend their refund on necessities like groceries and gas, 24% on savings, and another 24% on paying down debt. Only 14% said they would spend any of it on discretionary purchases like vacations or entertainment.

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A separate TaxSlayer/Talker Research survey of 2,000 taxpayers found similar patterns — 57% plan to use their refund on necessities including groceries, rent, utilities, and debt, with just 8% expecting to spend on anything they would classify as a luxury.

The Affordability Migration

The cost crisis is reshaping where Americans live. Thirty-eight percent of survey respondents reported having already moved because their previous location became too expensive. Among those who relocated, roughly a third moved to a different city and another third left their state entirely.

The generational gap in forced relocation is pronounced. Half of Gen Z respondents said they have moved due to costs, compared to 19% of baby boomers. Research from the Wharton School has documented a parallel trend — a sizable increase in young adults living with their parents, with housing affordability driving roughly one-quarter of that shift between 2000 and 2021.

"There are difficulties and challenges to buying a home. Some of which are more burdensome than on previous generations."

That observation came from Susan Wachter, a Wharton professor of real estate and finance whose research found housing affordability disproportionately impacts minority populations, with Asian, Black, and Hispanic young adults more likely to live with parents.

What may be most telling is the resignation embedded in the data. About half of all respondents said they do not believe they will ever afford to live in their ideal city or state. Among Gen Z, nearly two-thirds — 64% — have abandoned that aspiration entirely.

The Macro-Micro Disconnect

Economists and policymakers are grappling with a fundamental tension: aggregate economic data tells one story while household experience tells another.

Goldman Sachs projects GDP growth of 2.5% in 2026, above the consensus forecast of 2.1%. The investment bank's chief U.S. economist David Mericle has pointed to tax cuts, real wage gains, and rising wealth as factors that should sustain solid consumer spending.

"Tax cuts, real wage gains, and rising wealth should sustain solid consumer spending growth. New tax incentives, easier financial conditions, and reduced policy uncertainty should boost business investment."

But the Bank of America Institute has identified a critical caveat — the top third of higher-income households drive more than half of all consumer spending.

"Spending, wages and income continue to grow for both groups."

That came from Liz Everett Krisberg, head of the Bank of America Institute. But she acknowledged that a quarter of U.S. households currently live paycheck to paycheck.

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Federal Reserve Chair Jerome Powell addressed the disconnect directly in December, noting that many households are still dealing with the cumulative price increases from the 2022-2023 inflation surge.

"We're going to need to have some years where real compensation is higher, significantly positive, for people to start feeling good about affordability."

Since early 2020, cumulative Consumer Price Index inflation has risen roughly 25%, one of the fastest sustained increases in decades. While wage growth has recently outpaced inflation by approximately 1%, the Peterson Institute for International Economics warns inflation could surprise to the upside in 2026, potentially exceeding 4% by year-end due to lagged tariff effects, fiscal expansion, and tighter labor supply from reduced immigration.

Both Parties Claim Economic Ground

The cost-of-living crisis has become a political battleground heading into the 2026 midterms. The House Ways and Means Committee under Chairman Jason Smith (R-MO) has framed the tax provisions in the One Big Beautiful Bill Act as direct relief.

"Families are going to see for themselves how the working-class tax cuts benefit them when they get their tax refunds early in the new year."

Piper Sandler analysts project refunds could increase by an average of $1,000 per household in 2026 — an estimated $91 billion in total tax relief arriving between February and April. However, analysts note that higher earners are expected to capture the majority of that benefit.

Meanwhile, a Century Foundation survey found that 63% of Americans believe President Donald Trump has had a negative impact on grocery prices, while 61% said his administration has negatively affected their overall cost of living. The progressive think tank's research also found more than one in three Americans skipped a meal in the past year due to finances, up from one in four just months earlier.

The Stanford Institute for Economic Policy Research notes that affordability will likely dominate the November midterm elections. Economists there observed that current tariff policies have raised the effective tariff rate from 2.1% to an estimated 11.7%, with evidence suggesting more than half of those costs are being passed through to consumers.

Survey Methodology And Limitations

The Talker Research survey polled 5,000 Americans — 100 from each state — split evenly across generations: 1,250 Gen Z, 1,250 millennials, 1,250 Gen X, and 1,250 baby boomers. All respondents had internet access and planned to file taxes, which may exclude some lower-income populations and those working in cash economies.

The survey was commissioned by Current, a financial services company that offers banking and tax refund products. That commercial interest should be noted — Current has a financial incentive to highlight consumer urgency around early refund access, which aligns with its business model.

Additionally, responses reflect subjective perceptions of affordability rather than objective cost-burden measurements. The 100-per-state sample size means state-level findings carry wider margins of error than national results.

Other recent surveys have documented similar trends. A Bankrate emergency savings report found 58% of Americans have the same amount of or less emergency savings than a year ago, while 29% carry more credit card debt than emergency savings heading into 2026. A CBS News analysis documented that nearly half of Americans say it is harder to afford groceries than a year ago, and Redfin's 2026 housing forecast projects that while affordability will slowly improve, Gen Z and young families will continue facing difficult tradeoffs — including moving in with parents or roommates and delaying having children.

When aggregate GDP growth, rising corporate profits and strong consumer spending coexist with surveys showing half the country cannot reliably pay monthly bills, which set of numbers more accurately captures the state of the American economy — and what policy response does the gap between them demand?

Sources

This report was compiled using information from Talker Research's original survey results, StudyFinds' analysis of the Current/Talker Research poll, official data from the Bureau of Economic Analysis on Q3 2025 GDP, reporting by Fox Business on economic growth and CNBC on wages versus inflation, economic analysis from Goldman Sachs on 2026 GDP projections and the Peterson Institute for International Economics on inflation risks, Bank of America Institute's consumer outlook, research from the Wharton School on Gen Z housing affordability, the Century Foundation's affordability survey, House Ways and Means Committee statements on tax relief, Stanford SIEPR's 2026 economic outlook, Bankrate's emergency savings report, CBS News on America's affordability crisis, and Redfin's 2026 housing market predictions.

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