Debt.com’s annual poll of 1,000 Americans shows debt is a major reason to start budgeting. Fortunately, the budget has been a proven solution.
For six years, Debt.com has polled Americans on their budgeting behavior. More than 8 in 10 now have a monthly budget, a number that’s been trending upward since this survey’s inception in 2018.
One of the major reasons is also the most alarming. Nearly 1 in 4 say debt “prompted them to start budgeting.” That’s shot up more than 13 percent in only five years. The budgeting seems to work for them, because nearly 9 in 10 say it’s “helped them get out or stay out of debt.”
As positive as that may sound, it also alarms Debt.com’s president Don Silvestri. He feels everyone should spend on a budget through the hard times – and the good.
“If you only create a household budget because you’re worried about debt, what happens when the worst is behind you – will you stop budgeting?” Silvestri wonders. “If that happens, you’ll stop budgeting, get back in financial trouble, then start budgeting again. Budgeting should be preventative medicine, not emergency surgery.”
The survey’s other key findings:
- Nearly 9 in 10 say “everyone should budget.”
- 27% of those who don’t budget says it’s because they “don’t have much income.”
- 39% prefer creating a budget using a pen and paper.
- Half say they’re living paycheck to paycheck.
Far more respondents budget now than five years ago
Nearly 1 in 4 respondents say debt is the reason they started budgeting
More than 8 in 10 say budgeting has helped them “get out or stay out of debt”
4 in 10 respondents prefer budgeting with pen and paper
Most respondents who don’t budget say it’s because they “don’t earn enough money to warrant a budget”
Debt.com polled more than 1,000 Americans on their budgeting and spending habits. The majority say they budget their finances and it’s helped them get out and stay out of debt.
For the past five years, Debt.com has conducted its annual budgeting survey. The number of respondents who say they budget their spending and saving has increased each year.
The latest has hit an all-time high. More than 8 in 10 (86 percent) respondents track their monthly income and expenses. In 2021 and 2020, that was 80 percent. Pre-pandemic, in both 2018 and 2019, that number was roughly 70 percent.
Howard Dvorkin, CPA and chairman of Debt.com, has a hunch that world events over the past few years have motivated more Americans to keep an eye on their spending.
“It’s quite likely that both inflation and the pandemic have made Americans keen to budget,” Dvorkin says. “It’s a one-two punch.”
This year, the data is broken down by who actively uses a budget and who doesn’t.
The survey’s key findings:
- One reason budgeting might be more popular is that it’s much easier. While 39 percent of respondents still use pen and paper to create their budgets, that’s much less than the 66 percent from Debt.com’s first budgeting survey in 2018. Nearly 30 percent now use either mobile apps or online tools from their bank or credit union.
- Fully 85 percent of those who budget say that simple process got them out of debt or has helped keep them out of debt.
- Sadly, almost a third say they don’t budget because “I don’t have much income,” and half are living paycheck to paycheck.
Who should budget?
More than 8 in 10 of those who budget say it’s helped them get out or stay out of debt
How survey respondents prefer to create a budget
Most respondents who don’t budget say they don’t earn enough to warrant a budget
Who’s living paycheck to paycheck to make ends meet
| Who should budget? | Percentage of respondents |
|---|---|
| Everyone | 90.24% |
| People with a lot of debt | 3.77% |
| People with a limited income | 5.12% |
| People who earn a lot of money | 0.87% |
| Do you use a budget? | Yes | No |
|---|---|---|
| Percentage of respondents | 85.60% | 14.40% |
| Why don’t you budget? | Percentage of respondents who don’t budget |
|---|---|
| It’s too time-consuming | 20.13% |
| It makes me feel anxious/bad | 18.12% |
| I don’t have much income | 31.54% |
| It causes disagreements with my spouse/significant other | 9.40% |
| I have budgeted, but it’s never helped me | 20.81% |
| Have you been able to stay out of debt without a budget? | Yes | No |
|---|---|---|
| Percentage of respondents who don’t budget | 50.34% | 49.66% |
| What prompted you to start budgeting? | Percentage of respondents who budget |
|---|---|
| I want to increase my wealth/savings | 39.73% |
| Debt | 22.57% |
| Rising costs of living due to inflation | 17.16% |
| Retirement | 11.63% |
| Loss of job/income | 7.11% |
| Divorce/loss of spouse | 1.81% |
| How does your household feel about budgeting? | Percentage of respondents who budget |
|---|---|
| My whole household works to stay on budget. | 44.24% |
| I’m single, financially independent, and I budget! | 24.38% |
| I love to budget, but my significant other doesn’t. | 21.56% |
| My significant other is on a budget, but I am not. | 7.90% |
| I live with my parents, and I don’t use a budget because I’m saving up to live on my own. | 1.92% |
| Have you used websites for tips on how to build a budget? | Percentage of respondents who budget |
|---|---|
| No, I never thought about it | 65.24% |
| Yes, I have visited websites for advice other than Debt.com | 24.49% |
| Yes, that’s why I visited Debt.com | 10.27% |
| How do you prefer to create a budget? | Percentage of respondents who budget |
|---|---|
| Pen and paper | 39.16% |
| Spreadsheets | 28.56% |
| Mobile apps | 22.23% |
| My bank/credit union’s budgeting tools | 6.77% |
| A financial advisor | 3.27% |
| Which method of budgeting would you be most interested in trying? | Percentage of respondents who budget |
|---|---|
| Mobile apps | 47.40% |
| Spreadsheets | 19.64% |
| Pen and paper | 18.62% |
| My bank/credit union’s budgeting tools | 7.67% |
| A financial advisor | 6.66% |
| Has budgeting helped you get out or stay out of debt? | Yes | No |
|---|---|---|
| Percentage of respondents who budget | 84.88% | 15.12% |
| Have you been able to stay out of debt without a budget? | Yes | No |
|---|---|---|
| Percentage of respondents who don’t budget | 50.34% | 49.66% |
| Do you think dining out or ordering food should be included in a grocery budget? | Yes | No |
|---|---|---|
| Percentage of respondents who budget | 70.85% | 29.15% |
| Do you live paycheck to paycheck? | Yes | No |
|---|---|---|
| Percentage of all survey respondents | 49.81% | 50.19% |
Methodology: Debt.com surveyed more than 1,000 Americans and asked 12 questions about their budgeting and spending habits. People responded from all 50 states and Washington, DC and were aged 18 and above. Responses were collected through SurveyMonkey. Percentages were rounded up to the nearest whole number and might not total 100 percent.
Methodology: Debt.com surveyed more than 1,000 Americans and asked 12 questions about their budgeting and spending habits. People responded from all 50 states and Washington, DC and were aged 18 and above. Responses were collected through SurveyMonkey. Percentages were rounded up to the nearest whole number and might not total 100 percent.