American Consumers Are Feeling the Squeeze.

High inflation and elevated interest rates continue to pressure American consumers. Though resilient through the pandemic recovery, many are now stretched thin, with rising debt levels, growing defaults, and visible financial strain—evident in the growing number of people using installment plans to buy basic necessities like groceries.

Mounting Debt & Delinquencies

Post-pandemic, Americans initially reduced debt thanks to stimulus checks, reduced discretionary spending, and a refinancing boom. However, inflationary pressures and the Federal Reserve's rate hikes have made debt more expensive to manage.

By late 2024, serious delinquencies on auto loans and credit cards reached levels not seen since the Great Recession. Student loan delinquencies also surged following the end of the 3.5-year pause and a brief one-year "on-ramp" period. As of Q1 2025, the rate of seriously delinquent student loans spiked to 7.74%, up from just 1% the previous year. These delinquencies significantly damaged borrowers’ credit scores—some by over 140 points—while many now face wage garnishment by the federal government.

Buy Now, Pay Later – A Red Flag

Buy Now, Pay Later (BNPL) installment plans have grown in popularity, particularly among younger adults. While offering flexibility, BNPL can lead to overextension, especially when consumers stack multiple loans. In a troubling trend, one in four BNPL users now use these loans to purchase groceries—up from 14% a year prior—signaling the depth of consumer strain.

Confidence in Decline

Consumer sentiment has sharply declined, hovering near record lows. High prices, shifting economic policies, and the impact of tariffs have deepened uncertainty. Fear of future economic instability may lead to reduced consumer spending and business investment, raising the risk of economic slowdown and job losses.

Despite these challenges, recent Commerce Department data showed unexpected income growth and stronger household savings, which could offer a buffer against further economic shocks. Still, cautious consumer behavior and inconsistent policies contribute to a fragile financial outlook.

What Bon Vie Consulting Group Can Do For Your Team

At Bon Vie Consulting Group, we recognize that economic volatility creates new challenges—but also opportunities—for smart, proactive organizations. Here’s how we can help:

• Strategic Financial Planning: We support executive teams in forecasting and navigating rising costs, consumer behavior shifts, and macroeconomic trends that affect revenue models and operational efficiency.

• Workforce Resilience Strategies: Our consultants design programs that help employers support employees impacted by financial stress—from structuring flexible pay and benefits models to implementing financial wellness programs.

• Customer Behavior Insights: We help businesses understand how consumer sentiment and spending changes affect product demand and customer loyalty—and build strategies to adapt offerings accordingly.

• Scenario Planning & Risk Mitigation: Using data-driven modeling, Bon Vie can help identify potential economic stress points, allowing your leadership to make confident decisions in uncertain times.

• Policy Impact Analysis: Our team monitors regulatory changes—including tariffs, student loan policies, and interest rate movements—and evaluates how they impact your industry and workforce.

In a time when both consumers and companies face unprecedented headwinds, Bon Vie Consulting Group empowers leaders to remain agile, resilient, and growth-focused.