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In 2025, many consumers are changing the way they spend money due to rising prices and an uncertain economy. According to the WARC 2025 Global Consumer Trends report, more people—especially those with lower incomes—are choosing store-brand or budget items instead of expensive name brands. This change is happening because of concerns about inflation, trade policies, and the growing gap between the rich and poor. At the same time, digital tools like deal websites and coupon apps are helping people manage their money better. These tools make it easier for shoppers to find discounts and make smart financial choices in tough times.

In August 2025, U.S. inflation rose faster than expected, mainly because of new tariffs on imported goods introduced by President Trump. These tariffs are meant to help American industries, but they’re actually making it more expensive for companies to get the products and materials they need. As a result, the cost of producing goods has gone up, pushing wholesale inflation higher by 3.3% from last year. Although consumer prices have also risen by 2.7%, things like rent and gas have stayed relatively steady, helping to keep overall household costs from rising even more. Still, since many businesses are currently covering higher costs without raising prices for customers, there’s concern that prices at stores could go up in the near future. This ongoing inflation is also causing investors to expect the Federal Reserve might cut interest rates soon, as the economy faces pressure from both financial uncertainty and political tensions.

Consumer spending in the U.S. has stayed surprisingly strong through mid-2025, even with ongoing inflation and economic uncertainty. A big reason for this is the role of higher-income households, who have kept spending at high levels. In contrast, lower-income families, who boosted their spending in 2021 and 2022 thanks to pandemic-related savings and government stimulus, have seen their spending grow much more slowly since then. Experts say this shows that growing wealth gaps are shaping how people spend their money. While lower-income households have used up much of the extra cash saved during the pandemic, wealthier groups still have the financial cushion to keep buying, which helps keep overall spending up.

In August 2025, many Social Security recipients won't see their payments arrive on the same day due to the government's staggered payment schedule. Instead of everyone getting paid at once, the Social Security Administration divides payments based on birth dates: people born early in the month get paid on August 13, while others with later birthdays will receive theirs on August 20 or 27. This system, while routine, highlights how important timing is for retirees who rely on Social Security as their main income. Even though inflation is not rising as fast as before, many retirees are still feeling the pressure from high prices in recent years. For those on fixed incomes, waiting even a few extra days for a check can make it harder to cover monthly costs like rent, medical bills, and groceries.

Inflation in the U.S. stayed steady at 2.7% in July 2025, but prices are still rising for some items, especially those affected by new tariffs. Core inflation, which leaves out food and energy prices, rose to 3.1%, showing that the cost of many everyday goods is still going up. This is partly due to a 10% tariff announced earlier in the year by President Trump that applies to most imported goods, along with extra tariffs on certain countries. As a result, companies are starting to raise prices to cover their higher costs. At the same time, the job market is slowing down, with fewer jobs being added in July. All of this is causing some uncertainty for the economy and could affect interest rates and your spending power.

In mid-2025, the U.S. economy is facing a tough mix of high inflation, slower job growth, and uncertain trade policies, making it harder for many Americans to manage their money. Even though some economic numbers look good on the surface, rising prices are cutting into people’s purchasing power—a problem experts call “money illusion.” At the same time, the Federal Reserve is keeping interest rates high to fight inflation, which makes loans and mortgages more expensive. This, along with rising unemployment and unstable stock markets, is pushing more people to look for second jobs, switch careers, or ask for raises just to keep up. Adding to the pressure is the unclear future of international trade, as the U.S. has only temporarily extended its tariff truce with China, leaving many unsure of what comes next.