Americans Are Increasingly “Doom Spending” – Going Deeper Into Debt To Cope With Stress

The following report is by Credit Karma, first reported on November 16th, 2023:

Nearly every American is concerned about the current state of the economy (96%) – and it’s stressing them out about their finances. 

According to a study conducted by Qualtrics on behalf of Intuit Credit Karma, the top economic concerns among Americans who are concerned about the economy include inflation (56%), the cost of living increases (50%) and unaffordable housing (23%).Of those who are concerned about the economy, nearly half (48%) say not having enough money to afford necessities like food, clothing and rent worries them the most about how a poor economy could impact them, followed by going into debt (34%) and not being able to spend money on things that bring them happiness (30%). 

Younger generations are also concerned about how the current economy will impact their future job prospects and earning potential. Nearly a quarter of Gen Z respondents (23%) say they’re most worried about a lack of high paying jobs, decreasing wages (21%) and general job security (16%). Altogether, Americans are worried about their money. According to the study, two thirds of Americans say the current state of the economy gives them anxiety about their finances, with Gen Z and millennials being most likely to report feelings of financial anxiety (71%). 

To cope, many Americans are doom spending (27%). For the purposes of this study, “doom spending” is defined as spending money despite concerns about the economy and foreign affairs to cope with stress. This phenomenon, most common among younger generations (35% of Gen Z and 43% of millennials), may have gone up at the same time as Americans’ concerns about the economy have gone up (64%).

In the last six months, half of Americans say their financial situation has worsened, with 42% reportedly struggling to afford enough food for themselves and/or their household and another 56% living paycheck to paycheck. Yet, more than a quarter (27%) of Americans say they’re spending more money now than they were six months ago. This was especially true among Gen Z and millennials – one-third of which (33% of Gen Z and 34% of millennials) say their spending has gone up over the last six months. This increase in spending correlates to a rise in debt among consumers. 

According to the study, nearly one third (32%) of Americans’ debt level has increased over the last six months with millennials and Gen X being the most likely to report increased debt levels, 38% and 35% respectively. Of those with debt (74%), a quarter estimate they currently hold more than $10,000 in debt – a significant amount, especially amid record-high interest rates. 

Doom spending may also impact Americans’ savings rate. Within the last six months, nearly half of Americans (47%) say the amount of money they’re saving has gone down. Right now, more than half of Americans (52%) estimate they have less than $2,000 in savings or none at all, which is the case for 22% of Americans.  

Altogether, financial instability could be causing Americans to lose hope in the economy. According to the study, nearly a quarter (24%) of Americans are not optimistic about the economy in 2024. This was especially common among older generations; 40% of respondents aged 57 or above said they’re not optimistic about the economy in 2024, along with 28% of Gen X respondents. Of those who are optimistic, 24% say they’re hopeful inflation will level out, while others are hopeful that wages will increase (13%) and the job market will improve (12%). 

“Much like doom scrolling, we’re seeing people mindlessly shop to soothe concerns about the economy and foreign affairs, which could take a toll on their financial well being,” said Courtney Alev, consumer financial advocate at Credit Karma. “If you’re feeling stressed – you’re not alone – there are things you can do to get back on track. Start by doing an assessment of your finances to understand how much money you have coming in and out each month, as well as how much debt you owe. This will help you make a plan for how you’re going to spend your money moving forward. To get in the habit of better spending, consider using cash instead of cards until you get your spending in check. That way, you can limit your chances of overspending. Also, if your card information is stored online, you might consider deleting stored card information through your browser to make shopping online less frictionless.”

SEE: Americans Are Increasingly Using “Buy Now, Pay Later” Apps To Pay For Groceries And Fast Food

Methodology:

This survey was conducted online within the United States by Qualtrics on behalf of Intuit Credit Karma between November 3, 2023 and November 9, 2023 among 1,004 adults ages 18 and older.

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AUTHOR COMMENTARY

This so-called “doom spending” is a new name for a biblical phenomena that still holds true to this day:

[12] And in that day did the Lord GOD of hosts call to weeping, and to mourning, and to baldness, and to girding with sackcloth: [13] And behold joy and gladness, slaying oxen, and killing sheep, eating flesh, and drinking wine: let us eat and drink; for to morrow we shall die. [14] And it was revealed in mine ears by the LORD of hosts, Surely this iniquity shall not be purged from you till ye die, saith the Lord GOD of hosts.

[31] I protest by your rejoicing which I have in Christ Jesus our Lord, I die daily. [32] If after the manner of men I have fought with beasts at Ephesus, what advantageth it me, if the dead rise not? let us eat and drink; for to morrow we die. [33] Be not deceived: evil communications corrupt good manners. [34] Awake to righteousness, and sin not; for some have not the knowledge of God: I speak this to your shame.

Isaiah 22:12-14; 1 Corinthians 15:31-34

The OT reference to “let us eat and drink; for to morrow we shall die,” is spoken by people, who, rather than repent and mourn for all the wrong that they have done and has been done, and a making amends and restitution and penitence, they just double-down and say, party hardy. The NT is an extension of that, but in the context of their being no hope of the resurrection, and Paul mordantly just says, ‘well, if there is no hope in a resurrection, then why I am laboring and going through all these hard things? Let me just kick my shoes off and live like there’s no tomorrow.’

That’s what this “doom spending” is. The truth of the matter is, yes, for most younger people their hopes of having any real temporal and material success or opportunity, or and just even the basic of starting a small family, are dashed at this point; and they are now just giving up and throwing in the towel, and buying up useless junk with a credit card and buy now, pay later apps.

That being said, if you really think about it, the hefty majority of Americans have been “doom spending” for a long time now. You would think after the rounds of market crashes these last two decades, and continuously eroding economic conditions, you’d think people would tighten spending. Nope! Instead, people are borrowing beyond their eyeballs just to maintain this fake illusion of being middle class.

When this whole system finally implodes this year and in 2025, these people will be left desolate and they will die.

This problem is not unique to the U.S. Australia’s ABC did a report on the debt crisis amongst their Gen-Z population, some of them just not caring at all that they are in unrepayable debt.

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[7] Who goeth a warfare any time at his own charges? who planteth a vineyard, and eateth not of the fruit thereof? or who feedeth a flock, and eateth not of the milk of the flock? [8] Say I these things as a man? or saith not the law the same also? [9] For it is written in the law of Moses, Thou shalt not muzzle the mouth of the ox that treadeth out the corn. Doth God take care for oxen? [10] Or saith he it altogether for our sakes? For our sakes, no doubt, this is written: that he that ploweth should plow in hope; and that he that thresheth in hope should be partaker of his hope. (1 Corinthians 9:7-10).

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