Consumers Continue to Navigate Persistent Inflation by Changing Life Plans; Say They Want to Learn New Money Behaviors, According to Second Annual Wells Fargo Money Study

Rhea-AI Summary

Wells Fargo's second annual Money Study reveals that 76% of Americans are cutting back on spending, up from 67% last year, with even higher percentages among Gen Z (82%) and Millennials (79%). About 60% of Americans report making tough financial choices, with 55% delaying life plans - primarily travel (74%), home renovations (39%), relocation (30%), and buying homes (30%).

The study found that 90% of consumers experience "sticker shock" with prices between 55% and 200% higher than expected for common purchases. Despite financial challenges, 86% of Americans have clear financial goals and want to align money choices with their values.

Interestingly, while 87% of Americans say they don't judge others' financial circumstances, 56% keep their own finances secret, and 53% feel stress about others knowing their financial situation. Many respondents (47%) admit feeling envious of others' wealth.

Americans increasingly seek financial advice (36%, up from 24% last year), with higher percentages among teens (54%), Gen Z adults (61%), and Millennials (46%). Overall, 83% want to learn new ways of thinking about and handling money.

Positive

• 86% of Americans have a clear picture of what they want their money to do for them
• 87% believe now is a good time to save money
• 65% say now is a good time to invest
• Americans are increasingly seeking financial advice (36%, up from 24% last year)
• 83% want to learn new ways of thinking about money

Negative

• 76% of Americans are cutting back on spending, up from 67% last year
• 90% of consumers experience "sticker shock" with prices 55-200% higher than expected
• 55% of Americans are delaying life plans due to economic conditions
• 47% feel envious of how much money other people have
• 61% say they need a mental reset regarding their finances

• Ninety percent of Americans report that they are still surprised by high prices of items like water, gas, eating out and attending events
• Fifty-five percent saying they have delayed some of their life plans to navigate economic conditions over the past year
• Eighty-three percent want to learn new ways of thinking about money and dealing with their money

NEW YORK--(BUSINESS WIRE)-- Seventy-six percent of Americans are cutting back on spending, up from 67% in 2024, according to findings from the second annual Wells Fargo Money Study.

Wells Fargo Money Study (Graphic: Wells Fargo)

For adults in the first half of their financial lives, these numbers are even higher, with 82% of Gen Z adults and 79% of Millennials cutting back. And while not as high, it’s also of note that the youngest populations in the study are adapting to the current economic conditions with 60% of teens also reporting that they’re reducing their spending. In keeping with this theme, 60% of Americans say they are making tough financial choices to navigate their lives. Nearly as many (55%) said that those tough choices may involve delaying some life plans. Among those delaying life plans, a majority cite delayed travel more than anything else (74%), followed by home renovations (39%), relocation (30%), and buying a home (30%). One in six (17%) have delayed education plans, one in seven (14%) have delayed getting married, and one in eight (13%) have delayed retiring.

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“Consumer behaviors are shifting. The value of the dollar and what it is providing may not be as predictable anymore, which seems to be more pronounced for younger Americans,” said Michael Liersch, head of Advice and Planning at Wells Fargo. “There is a clear social narrative surrounding the question: ‘do I, and will I, have enough?’ The fact that these questions are being asked is positive because we know the earlier that people focus on their spending, saving, and investing behaviors, the more time they have to course correct to achieve their financial goals.”

At the forefront, consumers continue to navigate higher than expected prices

Nearly all those surveyed (90%) responded they feel “sticker shock” in one or more areas of common spending, including eating out, attending a concert, buying a bottle of water, or downloading a video game, and say actual costs are between 55% and 200% higher than what they expect.

Sticker Shock in Six Areas of Consumer Spending	% Shocked	Expected Cost	Actual Cost	How Much Higher than Expected
Eating out or food delivery	76%	$23	$40	74%
A tank of gas	63%	$40	$62	55%
Concert or sporting event tickets	39%	$70	$150	114%
A bottle of water	36%	$1	$3	200%
A greeting or birthday card	24%	$3	$6	100%
A video game download or streaming service	21%	$20	$50	150%

“Spending is one of the most important factors to staying on track with your goals,” says Liersch. “I would encourage people to continue to evaluate their financial choices and align their spending with what matters most to them. Life happens and making incremental progress toward a goal and adjusting timelines along the way – including setbacks – are all a part of the process. Staying focused on what we want to accomplish can get us through the twists and turns of our financial journey.”

Nearly all Americans (94%) acknowledge that they want to do just that: align money choices with their values. And almost as many (86%) want to be more intentional and thoughtful about their spending.

According to Liersch, “these insights highlight that Americans are not just winging it. They are being extraordinarily introspective and thoughtful as they navigate their financial priorities and work toward achieving their financial goals.”

Americans say they don’t judge others’ financial circumstances, but they do judge themselves

Americans overwhelmingly say they believe the amount of money their friends or family members have doesn’t matter. Almost nine out of 10 (87%) say it makes no difference to them how much money another person has, and nearly as many (82%) say their friends include people of different levels of wealth.

Yet more than half (56%) keep secret how much they have, with a third of them (32%) saying it’s because they are trying to avoid people judging them. Regardless of whether they keep money secrets or not, more than half of respondents (53%) say people knowing how much money they have would create stress.

Reasons People Keep Money Secrets
Money is a private topic for me	65%
So that people do not judge me	32%
The truth might result in people asking for money	30%
The truth might change how others see me	27%
The truth might change my interactions with people and what we do together	24%

A substantial number of those surveyed also spend time thinking about how much money other people have – and wishing they could have more themselves. Almost half (47%) responded they often feel envious of how much money other people have, and nearly as many (45%) often compare their financial situation to others. More than one in three (37%) admit to obsessing about getting rich, a third (34%) admire social media millionaires, and about one in four (23%) admit to sometimes overspending just to keep up with people around them.

“Americans appear comfortable with other people being authentic about their financial situation, which is encouraging to see,” Liersch says. “So now it’s time to look inwardly and overcome our own self-judgment. Let’s challenge ourselves with the following question: how can we lower focus on others and define financial success on our own terms? Resetting the frame of reference from others to our own personal benchmark may help us better spend time and energy on our best next step.”

Americans have clear financial goals, and want help to overcome challenges

Eighty-six percent of respondents say they have a clear picture of what they want their money to do for them. And the vast majority are optimistic about how to do it: 87% say now is a good time to save and 65% say now is a good time to invest. Yet nearly two-thirds say they need a mental reset (61%), and the following factors are holding them back:

• Habits are not easy to change (48%)
• They focus on today rather than tomorrow (43%)
• They do not know enough about money and finance (32%)
• They have a lot of others relying on them financially (29%)
• They feel social and peer pressure (15%)

To overcome these challenges in making progress to their goals, Americans are seeking more financial advice year over year. Last year, 24% said they were seeking more advice from others; this year it’s 36%. Looking across generations, the desire for more advice is higher with teens (54%), Gen Z adults (61%) and Millennials (46%).

“Younger generations are innovating and leading the way in so many areas. In this case they are leading in the desire to learn more about money and make informed financial decisions. And Americans are saying: Now is the time,” said Liersch.

About Wells Fargo

Wells Fargo & Company (NYSE: WFC) is a leading financial services company that has approximately $1.9 trillion in assets. We provide a diversified set of banking, investment and mortgage products and services, as well as consumer and commercial finance, through our four reportable operating segments: Consumer Banking and Lending, Commercial Banking, Corporate and Investment Banking, and Wealth & Investment Management. Wells Fargo ranked No. 34 on Fortune’s 2024 rankings of America’s largest corporations. In the communities we serve, the company focuses its social impact on building a sustainable, inclusive future for all by supporting housing affordability, small business growth, financial health, and a low-carbon economy. News, insights, and perspectives from Wells Fargo are also available at Wells Fargo Stories.

Additional information may be found at www.wellsfargo.com

LinkedIn: https://www.linkedin.com/company/wellsfargo

Wells Fargo Bank, N.A., is a bank affiliate of Wells Fargo & Company.

Investment products and services are offered Wells Fargo Advisors, a trade name used by Wells Fargo Clearing Services, LLC, and Wells Fargo Advisors Financial Network, LLC, Members SIPC, separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company.

About the Study

On behalf of Wells Fargo, Versta Research conducted a national survey of 3,657 U.S. adults and 203 U.S. teens age 14 to 17. Sampling was stratified, and data were weighted by age, gender, race, ethnicity, income, and education to achieve accurate representation of the current population based on estimates from the U.S. Census Bureau. The survey was conducted from September 5 to October 4, 2024. Assuming no sample bias, the maximum margin of error for full-sample estimates is ±2%. Unless noted otherwise, findings are based on the sample of adults, with data from teens reported separately.

Cautionary Statement about Forward-Looking Statements

This news release contains forward-looking statements about our future financial performance and business. Because forward-looking statements are based on our current expectations and assumptions regarding the future, they are subject to inherent risks and uncertainties. Do not unduly rely on forward-looking statements as actual results could differ materially from expectations. Forward-looking statements speak only as of the date made, and we do not undertake to update them to reflect changes or events that occur after that date. For information about factors that could cause actual results to differ materially from our expectations, refer to our reports filed with the Securities and Exchange Commission, including the discussion under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the Securities and Exchange Commission and available on its website at www.sec.gov.

News Release Category: WF-ERS

View source version on businesswire.com: https://www.businesswire.com/news/home/20250225157049/en/

Vince Scanlon 336-430-9786

Vince.scanlon@wellsfargo.com

Source: Wells Fargo & Company

FAQ

What percentage of Americans are cutting back on spending according to Wells Fargo's 2025 Money Study?

According to Wells Fargo's 2025 Money Study, 76% of Americans are cutting back on spending, which is an increase from 67% in 2024. The percentages are even higher among younger generations, with 82% of Gen Z adults and 79% of Millennials reducing their spending.

How are consumers responding to inflation according to the WFC Money Study?

According to the Wells Fargo Money Study, 90% of consumers report experiencing "sticker shock" with prices 55-200% higher than expected. As a result, 60% are making tough financial choices, 55% are delaying life plans, and 76% are cutting back on spending. Additionally, 83% want to learn new ways of thinking about money.

What life plans are Americans delaying due to economic conditions according to Wells Fargo's research?

According to Wells Fargo's Money Study, among the 55% of Americans delaying life plans, the most common delays are: travel (74%), home renovations (39%), relocation (30%), buying a home (30%), education plans (17%), getting married (14%), and retiring (13%).

How do Americans feel about others knowing their financial situation based on WFC's 2025 study?

Wells Fargo's 2025 Money Study reveals that 56% of Americans keep their finances secret, with 53% saying people knowing how much money they have would create stress. Interestingly, 87% claim they don't judge others based on wealth, yet 47% admit feeling envious of others' financial situations.

What percentage of Americans are seeking financial advice according to the latest Wells Fargo Money Study?

According to Wells Fargo's second annual Money Study, 36% of Americans are seeking more financial advice, up from 24% last year. The desire for advice is particularly high among teens (54%), Gen Z adults (61%), and Millennials (46%), reflecting a growing interest in financial education.

What are the main factors holding Americans back from achieving their financial goals according to WFC's research?

Wells Fargo's Money Study identifies five main factors holding Americans back from achieving financial goals: difficulty changing habits (48%), focusing on today rather than tomorrow (43%), lack of financial knowledge (32%), having many financial dependents (29%), and feeling social/peer pressure (15%).