US consumer spending has outpaced real disposable income for 24 consecutive months as of mid-2026, setting a new all-time record since the 1960s. The personal saving rate dropped to 2.7% in June 2026 from 4.4% in January, a decline of 1.7 percentage points in just six months. Credit card balances hit $1.26 trillion in Q2 2026 after a $21 billion quarterly surge, the second-highest level ever recorded. Real consumer spending grew approximately 2.6% year-over-year while real disposable income growth struggled to reach even 1%. Analysts note that higher-income households are disproportionately driving the spending, while lower- and middle-income earners face mounting financial pressure.
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