Tag Archives: budgeting

12.24.25
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It’s Not Getting Any Easier

By: Russ Kamp, CEO, Ryan ALM, Inc.

I wish for you and your family, friends, and acquaintances a joyous holiday season. I hope that 2026 proves to be an incredibly wonderful year in which the average American once again prospers. As regular readers of this blog know, I mostly focus my attention of DB pension plans, but I’ll occasionally write about the struggles that the American worker faces funding a defined contribution (DC) plan, such as a 401(k). A few months back, I wrote about the burden of homeownership on the American worker and the impact paying roughly 50% of the median household income has on one’s ability to then fund a retirement program.

Unfortunately, it isn’t getting any easier. I read today in the WSJ that the average monthly car payment is now >$750 per month. Oh, my! It is leading buyers of these cars to take out 8-, 9-, and 10-year auto loans. Can you imagine the interest that is paid on a 10-year loan? I suspect that most of today’s car buyers aren’t buying Lamborghinis. Folks not living in areas where mass transportation is abundant are forced to have a car available to get them to work. It is an essential expenditure, just as owning or renting a home/apartment.

In addition, I read yesterday that wage growth continues to moderate, with average hourly earnings only increasing by 3.5% for the 12-months ending November 30, 2025. That represents the slowest pace since 2021, and well below the near 6% peak reached in early 2022. As a result, an incomprehensible 57% of Americans rely on financial support from family or friends. Among parents with adult children, 40% provide ongoing support, with 53% drawing on retirement savings to provide the assistance. Given the cost of housing, it shouldn’t be surprising that 49% live with their adult children or more likely, the adult children are living with them.

Given these financial realities, do we really believe that self-funding a retirement program is truly in the cards for the average American worker? The financial burdens placed on them through costs associated with housing, healthcare, education, childcare, transportation, food, utilities, etc. is crushing. We have a bifurcated society at this time with too few halves actively participating. I don’t think that works longer-term for any economy. It certainly is not going to work when roughly 20% of the American population is 65-years old or older by an estimated 2030.

10.22.25
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And Now Utility Bills!

By: Russ Kamp, CEO, Ryan ALM, Inc.

Electric payment company Payless Power released a report showing how Americans are being forced to choose between keeping the lights on, buying groceries, or paying for medicine. They conducted a survey of 1,069 people, including nearly half of whom came from low-income households, and regrettably 39% said they’d fallen behind on electricity payments in the past year.

Incredibly, more than 30% received at least one shutoff notice, while 11% had their power cut off due to missed payments. “Beyond the financial stress, high electricity prices are creating real safety risks,” Payless Power said. “More than half of low-income households said they went without heat or air conditioning for several days in the past year because they couldn’t afford it.”

The impact of having one’s electricity shut off has led roughly 30% of the respondents to feel physically unsafe at home during extreme temperatures. Not unlike the challenging economic times found during the Great Depression, nearly one in four sent children or pets away from their home to escape dangerous indoor conditions.

More than half (52%) of low-income households cut back on groceries to pay utility bills, while 16% skipped medication or medical care. Another 19% reduced transportation or internet spending, and 5% missed rent or mortgage payments. As you can imagine, larger families are hit hardest, as households with five or more people were nearly twice as likely to fall behind as those homes with two or fewer individuals at home.

Rising utility costs come as households are already stretched thin by higher housing costs and food prices compounded by a deteriorating labor market. Research from Goldman Sachs shows consumers are absorbing >50% of the cost of President Trump’s widespread tariffs. In a Harris/Axios poll, 47% of Americans said groceries are more difficult to afford than they were in September 2024.

Lastly, as of Q2’25, Moody’s and the Federal Reserve estimate that the top 10% of income earners in the U.S. account for 49.2% of the consumption. This is the highest percentage on record dating back to when data collection began in 1989. A level of concentration such as this is NOT good for the long-term viability of the U.S. economy.

Now 51% of the Median Household Income