With inflation continuing to accelerate and a recession looming, an overwhelming majority of middle-class families are falling behind on their finances. Seventy-five percent of those earning between $30,000 and $100,000 a year believe inflation is cutting into their earnings, and 77% think the United States will be in a recession by year’s end, according to a survey from Primerica.

The quarterly survey additionally found that 39% fear their finances will be worse a year from now, up from 28% who held this dismal view last December.

From the lowest household savings rate since 2008 to mortgages, and auto and student debt hitting record highs and homeownership becoming more difficult than ever for the middle class—Americans of all incomes are reporting economic pain.

Tough Decisions

“There’s a higher level of concern financially among middle-income families than there was even at [the height] of the pandemic,” says Glenn Williams, CEO of Primerica. “When you see rising prices in staples like gas, rent, things you can’t avoid, it comes down to tougher decisions around priorities.”

Inflation in the U.S. is now 9.1%, and wholesale prices are up 10.4% in the past year.

Forty-two percent of middle-class Americans expect they will need to work longer before being able to retire, 22% say they will have to find a higher-paying job, 14% are planning to withdraw retirement savings, and 13% say they will need to pause student loan debt payments.

As a result of accelerating inflation and the Atlanta Federal Reserve’s GDPNow measure showing the U.S. economy may already be in recession currently, 71% of Americans plan to eat out less, 62% will buy fewer clothes, 54% are cancelling travel plans and 54% will drive less.

With 64% of Americans living paycheck-to-paycheck and the household savings rate at low levels, financial planners like Kathryn Hauer of Aiken, South Carolina, say now is the time to save money. “Now, of all times, you want to try to put aside some cash for emergencies like a layoff or a broken home HVAC unit,” Aiken tells CNBC. “Many Americans live paycheck to paycheck, which is never good but can cause insurmountable problems if the economy tanks.”

Quadruple Threat

Alongside high inflation and a probable recession, the two other significant threats are accelerating credit card debt and rising interest rates.

“Rates are rising and consumers are running out of options for cheap credit,” Nela Richardson, chief economist at ADP, tells CNBC. “That means consumers are not only making purchases at today’s inflated prices, they’re paying even more on top of that to cover the rising cost of borrowing,”

Credit card debt in the U.S. rose to a total of $841 billion in the first three months of 2022, according to the Federal Reserve Bank of New York.

One way to potentially lower the interest rates on a credit cards, is to have a strong credit score, says Gina McKague, founder of Michigan-based McKague Financial.

That can be achieved by paying off credit card bills promptly each month. People can also shop around for cards with the most attractive rates.