Fed survey: Americans feel financially secure despite prices

• Key takeaway: The survey, conducted last October, found that 73% of adults said they were "living comfortably" in 2025, a figure unchanged from the year prior.
• Supporting data: Respondents viewed the national economy less favorably than their own financial situations. Nearly one-fourth of adults, or 24%, rated the national economy as "good," down 3% from 2024.
• What's at stake: Inflation pressures, already a concern last year, are expected to remain a concern in 2026 as the war in Iran drives up energy costs and those costs ripple through the economy. 

WASHINGTON — U.S. households generally felt financially secure in 2025, though many remained concerned about rising prices for goods and services.

An annual Federal Reserve survey found that 73% of adults said they were either "doing OK" or "living comfortably" financially, unchanged from the previous year but below the 78% peak recorded in 2021.

The report, titled "Economic Well-Being of U.S. Households," was conducted from Oct. 17 to Oct. 28 and included responses from nearly 13,000 adults ages 18 and older.

The report found that many households maintained savings for unexpected expenses. About 63% of adults said they could cover a $400 emergency expense using cash or its equivalent, unchanged from the previous three years but down from a peak of 68% in 2021.

Despite overall financial stability, the report noted "meaningful declines" among some demographic groups, including low-income, younger and Black adults. Among racial and ethnic groups, 82% of Asian adults reported living comfortably or doing OK financially, followed by 79% of white adults, 62% of Hispanic adults and 60% of Black adults. The share of Black adults reporting financial comfort fell from 65% a year earlier.

Respondents viewed the national economy less favorably than their own financial situations. Nearly one-fourth of adults, or 24%, rated the national economy as "good," down three percentage points from 2024 and 24 percentage points from 2019.

The labor market also emerged as a growing concern. The survey found that 42% of adults worried about finding or keeping a job, up from 37% a year earlier.

Despite those risks, the Fed said in the report that labor market indicators "remained solid" throughout 2025, citing a small increase in layoffs alongside declines in voluntary quits and job switching.

The Fed's rate-setting committee cut short-term interest rates by a total of 75 basis points last year in an effort to support the labor market. This year, however, policymakers are expected to take a more cautious approach as worry about inflation tied to the Iran war intensifies.

The report, released Wednesday, found that rising prices remained a top of mind for households last year. About 58% of adults said changes in prices compared with the previous year had worsened their financial situation, down slightly from 60% in 2024.

An overwhelming majority of those surveyed, 77%, said they took some action in response to higher prices, such as switching to cheaper products or delaying a major purchase.

Recent government data shows inflation pressures continuing. The Bureau of Labor Statistics reported that the Consumer Price Index rose 0.6% in April and 3.8% from a year earlier, driven largely by higher energy costs. Core inflation, which excludes food and energy, increased 0.4% from the previous month and 2.8% from a year earlier.

Gasoline prices rose 5.4% in April after surging 21.1% the previous month. Food prices also increased after showing signs of stabilization earlier in the year. Grocery prices rose 0.7%, led by higher costs for beef and produce.

Some central bank officials have signaled growing unease about how the Iran war could affect inflation going forward. At its May meeting, members of the Federal Open Market Committee cited uncertainty tied to the conflict as one reason for keeping monetary policy unchanged.

Rising energy costs tied to the war in Iran are expected to squeeze working-class family budgets, though economists generally do not expect the conflict to push the U.S. economy into a recession in the near term.