As economic conditions remain unstable, consumers are increasingly anxious about the possibility of unexpected expenses this year. With prices projected to rise sharply in the coming months, many fear they’ll have no choice but to borrow money to cover surprise bills — a decision that can lead to significant costs due to high interest rates.
The most common sources of financial anxiety include:
- Emergency car repairs
- Home maintenance issues
- Unforeseen medical expenses
These costs can be substantial. For example, the average cost of home repairs is estimated at $2,112.
What’s more concerning is that inflation, economic slowdown, and a possible recession could push these expenses even higher in the near future.
Unsurprisingly, the hardest-hit are those living paycheck to paycheck — people who have little left after covering monthly bills and minimal savings to fall back on in emergencies.
A recent survey by Splitit and PYMNTS highlights the issue: over half of consumers are worried about getting hit with unexpected costs in the months ahead.
This concern comes amid a broader sense of economic insecurity. Rising tariffs and increasing costs are weighing heavily on consumers’ minds, leading to a noticeable drop in consumer confidence across several studies.
One report from Prosper Marketplace, published in early April, found that nearly half of consumers say their incomes haven’t kept pace with inflation. Other key findings include:
- Most believe the economy has worsened since the COVID-19 pandemic.
- Two-thirds report having no investments at all.
- Credit card debt is rapidly increasing.
- 63% are unable to pay off their credit card balances in full.
- Over 50% are living paycheck to paycheck, and 4 in 10 say they couldn’t handle a financial emergency.
Unplanned expenses also take the form of impulse purchases. While this type of spending can be controlled, it still represents a financial risk during times of instability.
“From trade disruptions to market volatility, Americans are navigating an expanding list of financial challenges,” said Nandan Sheth, CEO of Splitit. “Consumers are feeling very anxious right now.”
Sheth notes that people are becoming more intentional in how they manage unplanned expenses, often turning to more flexible payment options. Credit cards remain the go-to for many — 38% of Baby Boomers still use them for emergency purchases. However, some consumers are exploring credit card-linked installment plans, which can help them handle unexpected costs more manageably.
A separate HarrisX survey supports this trend toward caution. While consumers continue to buy essentials like groceries and beverages, they’re cutting back on big-ticket and discretionary items. Less than half say they’re still buying household appliances or upgrading smartphones, and only a third are purchasing new cars or luxury goods at the same rate as before.
Meanwhile, a survey by NCSolutions reveals Americans are especially concerned about price increases for everyday grocery items like coffee, tea, cheese, and bananas. To save money, many plan to seek out sales, switch to store brands, or buy private-label products when possible.
Access to credit is another major factor influencing spending habits. Those with strong credit are more likely to use their cards for surprise expenses, while those with lower credit scores often hesitate due to limited borrowing options.
Younger consumers — particularly Millennials (born 1981–1996) and Gen Z (born 1997–2012) — are gravitating toward flexible payment solutions. These tools are becoming essential for helping them stay on top of their budgets and financial well-being.
Ultimately, the tension between financial discipline and the urge to spend spontaneously is real. Surveys show that half of all consumers made unexpected purchases last year — whether planned or impulsive — highlighting the delicate balance many must strike between staying cautious and managing life’s inevitable surprises.
