If You’re Living Paycheck to Paycheck, Where You Live May Be To Blame
Although there are Americans living paycheck to paycheck in every part of the country, those living in some regions are more likely to be struggling to make ends meet than others. In addition, living in rural versus metropolitan areas can also have an impact on whether are not you are likely to be living paycheck to paycheck.
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Americans in the South Central Region Are Most Likely To Be Living Paycheck to Paycheck
According to a new study conducted by LendingClub, nearly 59% of all consumers in the South Central region (Texas, Oklahoma, Arkansas, Louisiana, Mississippi, Alabama, Tennessee and Kentucky) live paycheck to paycheck — more than in any other region of the U.S.
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“Local conditions — notably, the stagnant wages, the level of unemployment and, over recent years, severe weather events such as hurricanes and electrical storms ravaging parts of the region — are some factors that make it hard for consumers in the South Central region to build savings,” said Anuj Nayar, LendingClub’s financial health officer.
Americans living in the Northeast region (Pennsylvania, New Jersey, New York, Connecticut, Rhode Island, Vermont, New Hampshire, Massachusetts and Maine) are the second most likely to be living paycheck to paycheck, with 56% stating that they currently are. Of those living in South Atlantic states (Florida, Georgia, North Carolina, South Carolina, Virginia, West Virginia, Washington, D.C., Maryland and Delaware), 54% are living paycheck to paycheck — which is on par with the national average. The study found that 53% of Americans in the Pacific region are living paycheck to paycheck, while 51% of those in the Midwest are.
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Residents in the Mountain region (New Mexico, Arizona, Nevada, Utah, Colorado, Wyoming, Idaho and Montana) are the least likely to be living paycheck to paycheck — only 49% are.
City Dwellers Are More Likely To Be Living Paycheck to Paycheck
Across the U.S., the study found that 63% of consumers residing in metropolitan areas live paycheck to paycheck, compared to just 39% of those who live in rural areas. Although cost of living is certainly a factor here, there may be other factors in play as well.
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“Lifestyle creep is another factor impacting Americans who live paycheck to paycheck, especially in metropolitan areas,” Nayar said. “Lifestyle creep is the gradual increase in spending that happens when someone starts to make more money and in turn, starts spending more to maintain a certain lifestyle level. One example that immediately comes to mind is when you get a raise and convince yourself that you can finally get a new car or a fancier new apartment. The danger of lifestyle creep is that it happens so gradually, people often don’t notice it — but it can be a huge factor in living paycheck to paycheck.”
In some regions, however, rural residents are more likely to be living paycheck to paycheck than those who live in cities. In the South Central region, for example, 58% of rural residents are living paycheck to paycheck versus 52% of metropolitan residents.
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“One factor contributing to consumers in rural areas being more likely to be living from one paycheck to the next is the changing landscape of the job scenes for those who stayed, with many jobs shifting to bigger cities,” Nayar said.
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This article originally appeared on GOBankingRates.com: If You’re Living Paycheck to Paycheck, Where You Live May Be To Blame
