US consumer spending outpaces disposable income for record 24 months

American consumers are facing increasing financial tension as real consumer spending has outpaced real disposable personal income for 24 consecutive months. This represents the longest such divergence on record, surpassing the previous record set during the late 1970s.

Data indicates that while spending continues, there is a growing psychological shift. A survey of 5,000 Americans found that 72% feel guilt when spending on non-essential items that compete with financial goals. This trend is driven by persistent inflation in essential sectors such as housing, food, energy, and insurance, which continues to erode purchasing power despite nominal wage growth.

Financial indicators show a decline in the personal saving rate, which dropped to 2.7% in June 2026 from 4.4% in January. Additionally, credit card balances reached $1.26 trillion in the second quarter of 2026, marking the second-highest level ever recorded. Analysts note that spending growth is being disproportionately driven by higher-income households, while lower- and middle-income earners face significant mounting pressure.