Has affordability become worse in the U.S. over the years?

The aftermath of the pandemic led not only to prices rising but a complete reset, permanently elevating cost to a higher baseline. From 2021 to 2023, overall prices climbed about three times faster than normal inflation settling at 17–18%. Albeit inflation did simmer down to around 2.4% by early 2026; still households are left with no other choice to pay those elevated prices every day.

What’s transpiring owing to this is a reality where a typical household now spends about $15,400 more per year on basic essentials than it did in 2019. Even with the growth of income, many families aren’t keeping up; households in 30 states effectively lost 3.2% of their income to rising costs.

What remains after using income for paying the basics is just chump change. In 2025, households had about 24.7% of income which translates to $2,170 per month left over on average but in the least affordable states, that cushion shrinks to roughly $800. Rhode Island and Massachusetts have the steepest squeeze, with living costs rising 8 percentage points faster than incomes, while California and New York followed at 7%. 

It’s pretty obvious that Americans have a problem: they are financially squeezed beyond just middle class and low-income people. Across 160 metro areas, basic necessities are unaffordable by 20% of middle-class households where they live. In fact, roughly one-third of the U.S. middle class struggles to cover essentials like housing, food, and childcare despite earning what’s perceived as a “comfortable” income.

Meanwhile, problems in the real-world are singing the same tune with food prices rising 2.9% year-over-year in January 2026 and are anticipated to climb another 3.1%. (Also to be noted, utility costs jumped over 6% in the same period). To make ends meet Americans are leaning on credit which to no surprise led total household debt to reach $18.8 trillion by late 2025, with credit card balances penciling in $1.28 trillion.

Policy hasn’t fully done much to alleviate the situation while efforts to cut costs grab headlines; they fail to make an impact. Inflation may have simmered down, but affordability hasn’t recovered. Prices rose fast, continuing to stay high and for millions of Americans, the math still doesn’t add up.