Americans turn to extreme savings as inflation and tariffs squeeze wallets

[UNITED STATES] Americans have been grappling with the rising cost of living since inflation began accelerating in 2021. Now, with renewed economic strain following former President Donald Trump’s revived tariff agenda, many are taking more decisive steps to curb spending.

The latest Consumer Price Index (CPI) figures show a 3.8% increase in prices over the past year, with everyday necessities like food, housing, and transportation seeing the steepest jumps. Economists warn that the new round of tariffs—ranging from 10% to 25% on a variety of imports—could further intensify financial pressure, especially for middle- and lower-income households already struggling to stay afloat.

A recent survey by Intuit Credit Karma, which polled over 2,000 U.S. adults in April, found that 83% of respondents said they would significantly cut back on non-essential purchases if their financial situation worsens in the near future.

On platforms like TikTok, saving challenges have surged in popularity, particularly among young adults. Trends such as #NoBuy, #LowBuy, #SlowBuy, and #Underconsumption promote strategies to resist impulse purchases and focus on making do with existing resources.

These social media-driven movements reflect a broader cultural pivot toward frugality, especially among younger generations facing stagnant wages and heavy student debt. According to a 2024 Pew Research study, 45% of Americans under 30 believe they will never match their parents' financial stability—fueling the appeal of extreme budgeting tactics.

Inside the "No Buy" Movement

The “No Buy 2025” challenge encourages participants to eliminate all non-essential spending for an entire year—covering categories like clothing, electronics, books, and entertainment. Related challenges like “Low Buy” and “Slow Buy” promote more intentional spending, with rules such as delaying purchases for at least 48 hours and limiting how often discretionary items are bought. The aim is to disrupt habitual overspending, sometimes dubbed “doom spending,” as fears of an impending recession grow.

Financial content on social media continues to shape young consumers’ habits. A survey by H&R Block’s Spruce platform found that 68% of Gen Z respondents are influenced by these trends, and more than one-third rely on social platforms for financial advice. Many also use social media as an outlet for financial stress, often joking about economic downturns or “recession symptoms.”

Mounting Financial Pressures

The rising popularity of savings challenges coincides with growing financial distress across the country. Reports indicate that many Americans have already depleted their savings and are increasingly turning to credit cards to make ends meet.

Credit card balances have hit a record $1.13 trillion, according to Federal Reserve data, while delinquency rates are at their highest in over a decade. Experts attribute this to inflation, rising interest rates, and the gradual erosion of the financial safety nets built during the pandemic.

With tariffs now officially in place and signs of economic slowdown on the horizon, concerns about affordability and financial resilience are deepening. “Consumers are going to bear the brunt of the price increases that come with these tariffs,” said Eugenio Aleman, chief economist at Raymond James. “That means cutting back, particularly on non-essential spending.”

A Gallup poll conducted after the Trump administration’s tariff announcement revealed growing pessimism among Americans: 53% said their financial situation was deteriorating, while just 38% reported improvement. Meanwhile, 57% expressed concerns about maintaining their standard of living.

The psychological toll of financial stress is also growing. A recent Bankrate report found that 43% of U.S. adults say money is negatively affecting their mental health at least occasionally, with symptoms ranging from anxiety and sleeplessness to depression. The impact is especially pronounced among millennials and Gen Z, who often feel stuck between rising expenses and limited earning potential.

“Young people feel enormous pressure to keep up financially—whether driven by social media or broader societal norms,” said Dr. Lisa Reynolds, a financial psychologist. “It’s a constant stressor.”

“Tariffs, inflation, interest rates, and a potential recession are outside of individuals’ control,” said Sarah Foster, an economic analyst at Bankrate. “What people can do is take proactive steps to manage their finances, which can offer a sense of control and stability.”

Building Better Financial Habits

While TikTok challenges may offer a short-term boost, experts caution that sustainable financial well-being comes from developing sound habits.

“Don’t compare yourself to what others are doing financially,” said Daniel Milan, managing partner at Cornerstone Financial Services in Michigan. “That’s one of the most basic principles of personal finance.”

Milan emphasizes the importance of creating and reviewing a budget. “People don’t like the word ‘budget,’” he said. “But the reality is, sitting down and understanding your expenses can be a powerful way to regain control.”

He recently audited his own household expenses after getting married, identifying overlapping subscriptions and redundant costs. The result? A savings of roughly $800 per month. “That kind of financial housekeeping can make a major difference in your monthly cash flow,” Milan said.