JD Power Financial Health Report Shows Rise in Consumer Confidence and Affordability Pressure
By Roy Urrico
While overall buyer confidence showed improvement, housing-related affordability pressures rose, and many consumers still showed actual signs of financial distress. These are among the observations gathered from the August 2026 Financial Health Report, from JD Power, the Troy, Mich.-based data analytics and financial services intelligence research company.
Part of a monthly Banking and Payments Intelligence series the Financial Health Report examined consumer sentiment around financial health and the economy based on responses from 4,000 consumers nationwide and was fielded in July 2026.
The insight dives into several key data points including:
Concerns about gas prices are declining, while worries over housing costs are close to becoming the second-largest source of financial stress.
In the previous 30 days, 29% of consumers took actions indicative of financial distress such as missing rent, mortgage or utility payments.
The share of U.S. consumers classified as financially healthy held at 34% in July — its second consecutive month at that level and the highest reading since November 2025, according to JD Power.
For consumers that find themselves stuck in financial malaise, financial institutions can help strengthen everyday financial habits with guidance and engagement, offered Jennifer White, managing director of financial services intelligence at JD Power, and author of the report.
She emphasized, “At a time when housing affordability concerns are rising and nearly one-third of consumers report behaviors associated with financial distress, the role of financial institutions extends beyond products and services to helping customers build resilience and confidence. Credit unions are uniquely positioned in the current environment because members increasingly want a trusted financial partner, not just a transaction provider."
Signs of Financial Distress
“While overall consumer confidence is improving, housing-related affordability pressures are also on the rise, and many consumers are still showing real signs of financial distress. It’s an example of 2026’s K-shaped economy at work, as the landscape shows that there is clearly uneven resilience among the different consumer segments,” the report revealed.
Seventy-seven percent of consumers said they made changes to their day-to-day expenditures to address increasing costs, and 29% of those changes are actions indicating more dire financial distress. That includes selling personal possessions to cover bills; missing rent, mortgage or utility payments; or skipping a prescription or rationing a medication due to cost.
In July, the total share of financially unhealthy consumers, defined as those who are financially vulnerable, overextended or stressed, was unchanged at 66%.
Affordability Concerns Impact Spending
The total number of consumers who say monthly expenses felt less affordable than six months earlier declined to 43%, down from 45% last month. “While affordability concerns have been trending down since their peak in April, the cost of everyday items remains a prevalent issue,” said the report, which added stressed (56%) and vulnerable (53%) consumers are most likely to say their expenses are less affordable.
Other affordability-related findings:
Most consumers continue to modify their spending habits, with 77% once again reporting changes to their day-to-day expenses in July, a rate that was unchanged from June.
The most common areas where people are cutting back include lifestyle changes like dining out and entertainment (41%), switching to less expensive brands or stores (32%) and delaying non-essential or discretionary purchases (28%). More concerning, 27% of consumers cut back on groceries or skipped meals and 18% have borrowed money from family or friends to cover expenses.
While grocery prices continue to place the greatest strain on consumers, housing costs are starting to become a focal point. Overall, 43% of consumers said the high cost of groceries is causing the most stress, which is flat from June. Gas continued to fall to just 26% (down 5 percentage points), while housing is close to overtaking gas as the second biggest source of financial stress among U.S. consumers (24%).
Consumers Look for Tangible Wins
“As consumers continue to feel persistent financial stress, they are looking to build some positive momentum. To do that, they want tangible wins, and while big financial moves like consolidating credit card debt or paying off a home equity loan may be out of reach, they can take small steps to improving their financial standing,” said the JD Power monthly report.
By showing customers which debt to prioritize to make the biggest impact on their credit, financial institutions become valuable partners in this pursuit, suggested JD Power. In fact, FIs and card issuers receive their strongest customer satisfaction and brand advocacy ratings when they help customers meet credit and borrowing needs and improve their credit scores.
"Our data shows consumers continue to experience financial strain even as broader financial health metrics stabilize. Institutions that help members manage debt, improve savings habits and make informed borrowing decisions are likely to build deeper trust and stronger long-term relationships," said White.
