Many consumers have been re-evaluating their spending priorities amid higher prices on goods and services over the past 12 months, with the potential for tariffs to cause further increases sharpening that reconsideration. Yet new data from PYMNTS Intelligence reveals surprising areas where consumption stays steadfast, along with widening disparities in how consumers across different financial lifestyles plan to adapt to price increases. The data uncovers the critical price thresholds that can trigger a widespread pullback in spending across technology and digital services, groceries and dining out, household and lifestyle, and personal care.
PYMNTS Intelligence finds that the share of consumers living paycheck to paycheck—65% of U.S. adults in March 2025—remained stable throughout the first three months of the year. For these shoppers, especially those who struggle to pay their monthly bills (22% of all consumers), rising prices are not an abstract economic trend but a daily decision-making challenge.
From changing where they shop to skipping entire categories of purchases, the picture is one of consumers feeling increasingly pushed to make difficult decisions in every aisle. Yet insights into shoppers’ evolving spending habits reveal surprising resilience, especially in the household/lifestyle and personal care sectors. For instance, a vast majority of consumers who have had at least one manicure within the last 12 months say they will continue to indulge even if costs go up, indicating the inherent value they place on such services.
But even loyal consumers will walk away when prices reach double their prior levels. These shifts, compounded by uncertainty surrounding the Trump administration’s constantly shifting global tariff regime, hold significant implications for retailers as they strategize pricing in an increasingly cost-conscious and economically sensitive market.
These are just some of the findings detailed in this edition of “New Reality Check: The Paycheck-to-Paycheck Report,” a PYMNTS Intelligence exclusive series. This edition, “Navigating the Shifting Sands of Consumer Spending Amid Rising Prices and New Tariffs,” examines the impact of inflation on the financial lifestyles of U.S. consumers through insights from a survey of 2,280 U.S. consumers conducted from March 12, 2025, to March 31, 2025. The report explores the impact of inflation and tariffs on consumers’ purchasing habits.
Price-Proof Products: Personal Care and Child-Related Spending Show Resilience
As prices climb, the average consumer negotiates a complex landscape of needs and wants, making tough choices about where to tighten their belt and what to keep purchasing at all costs. Buying less of something or cheaper variants are popular options, with more than two-thirds of consumers combined taking these routes. Yet certain expenditures show remarkable price inelasticity, meaning they are resistant to pullbacks from price increases.
Data shows that 30% and 23% of all consumers surveyed, respectively, would continue to buy personal care and household/lifestyle products when faced with price increases. Notably, only 5.1% of consumers who have visited a nail salon in the last 12 months would forgo professional manicures or pedicures if prices were to rise. These findings underscore the service’s deeply ingrained value or perceived necessity among consumers, making them willing, to a degree, to pay higher prices.
Consumer loyalty to household/lifestyle and personal care products reflects both the inherent value placed on these items and demographic purchasing. For instance, 81% of high-income individuals earning more than $100,000 a year made a select personal care purchase in the past year, compared to 50% of their lower-income (those earning less than $50,000) counterparts. In other words, since these product categories (household/lifestyle and personal care) are consumed at higher rates by high-income individuals, any price increases would likely not have as much of an impact on purchasing compared to other product categories with a wider consumer base, such as dining out.
Price inelasticity is mirrored in spending related to children. While 34% of parents would buy cheaper and 19% would buy less, just 2.9% report they would stop paying for children’s extracurricular activities even if their cost increased. At 42%, consumers are more likely to buy less designer clothing, while vacationers are more likely to buy cheaper when prices rise. In contrast to children’s extracurricular activities, vacations, at 7.1%, and designer clothing, at 14%, face significantly higher abandonment rates, signaling where consumers draw the line on discretionary spending.
These findings highlight the priority many consumers place on these personal well-being and developmental activities as they embed them into essential household spending. Moreover, inclusion of child-related costs within the household and lifestyle categories further contributes to their overall price stickiness, reflecting strong parental emphasis on these investments.
Within consumer spending on groceries and dining out, a clear hierarchy of necessity emerges. Again, two-thirds of consumers—half of them buying less, the other half, cheaper—report that they would take either of those routes when purchasing groceries or dining out. But while restaurant dining is viewed as discretionary, just 14% of consumers are willing to eliminate it entirely after price increases. Only 3.4% would stop purchasing milk (dairy or plant-based), demonstrating its essential status in household budgets. These findings underscore specific areas where consumer demand demonstrates less sensitivity to price increases, providing valuable insights for businesses operating in these sectors.
The Economic Resilience Gap: How Finances Impact Spending Choices
What shoppers are willing to cut back on or abandon altogether varies significantly according to their financial lifestyle (which does not always correlate with income, as some high-income consumers live paycheck to paycheck). Consumers who do not live that way are 2.4 times more likely to keep their purchasing habits at the same level amid price increases compared to those struggling financially. Specifically, 31% of financially secure consumers reported they would continue buying at their current quantity and frequency. By contrast, only 13% of paycheck-to-paycheck consumers with issues paying their monthly bills indicate the same.
This “economic resilience gap” illustrates the profound relationship between financial security and consumer price elasticity. Furthermore, paycheck-to-paycheck consumers are more inclined than those not living that financial lifestyle to seek cheaper alternatives or reduce the quantity or frequency of their purchases when prices increase.
Concerns about tariffs are also influencing consumer responses to rising prices. Across all financial lifestyles, 8.2% of consumers who think tariffs will negatively impact their finances plan to stop buying certain goods and services if prices increase, compared to 6.1% of those who view tariffs in a positive light—a 34% difference. Again, most shoppers say they will buy less or buy cheaper, further indicating how broader economic concerns can amplify a consumer’s sensitivity to prices.
Across all product categories, consumers not living paycheck to paycheck are more inelastic, meaning they are more likely to continue purchasing all types of products and services when faced with higher prices. Across financial lifestyles, however, certain purchases show more vulnerability. Whereas 41% of consumers not living paycheck to paycheck would continue buying personal care products regardless of how much more they cost, only 14% of paycheck-to-paycheck consumers struggling to meet their monthly financial obligations would do the same. In fact, financially stable consumers are 193% more likely to keep buying personal care products than struggling consumers. Likewise, data on spending habits shows that financially stable consumers are 93%, 114%, 169% and 150%, respectively, more likely than crimped consumers to keep buying technology, groceries and dining out, and household and lifestyle goods and services. This disparity in consumers’ purchasing decisions highlights the constrained options faced by financially vulnerable consumers and their heightened sensitivity to price fluctuations, contrasting with the greater capacity of financially stable consumers to absorb cost increases.
Price Sensitivity Threshold: When Prices Double
Beyond gradual price increases, a critical point is reached when prices rise 10%. Nearly 52 million consumers would abandon spending on select types of technology and digital devices—from laptops to Netflix subscriptions—as well as on groceries and dining out, household and lifestyle items, and personal care products and services, once the price goes up by 10%. Nearly 11 million more would draw the line at prices doubling. Collectively, 62.8 million individuals would stop making certain purchases. Notably, more than 1 in 4, or 27%, of shoppers said they would abandon purchases in the household/lifestyle category when their prices doubled. This suggests that even categories initially showing price inelasticity have a limit to consumer tolerance.
While overall trends show increased abandonment at higher prices across all product categories, an interesting exception emerges among financially struggling consumers. Consumers living paycheck to paycheck with issues paying bills (14%) are less likely to give up their retail memberships compared to financially secure consumers (15%) when prices increase, suggesting the perceived value of savings from retailers such as Costco and Amazon Prime. This unique pattern suggests that membership-based savings models provide essential economic utility to financially vulnerable households, prioritizing maintaining their memberships even under price pressure. Meanwhile, other discretionary categories, including dining out, video streaming subscriptions and premium cosmetics, show the expected pattern, with struggling consumers much more likely to abandon purchases. Consumer sensitivity to price thresholds thus underscores the potential for a drop-off in buying if retailers’ pricing strategies lead to extreme price hikes across various product categories.
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Methodology
“New Reality Check: The Paycheck-to-Paycheck Report—Navigating the Shifting Sands of Consumer Spending Amidst Rising Prices and New Tariffs,” examines the impact of price increases on the spending patterns of U.S. consumers and draws on insights from a survey of 2,280 U.S. consumers conducted from March 12, 2025, to March 31, 2025. The report explores the impact of inflation and tariffs on consumers’ purchasing habits. Our sample was balanced to match the U.S. adult population in a set of key demographic variables: 51% of respondents identified as female, 33% were college-educated and 28% declared incomes of between $50,000 and $100,000 per year.
