CHICAGO, Sept. 17, 2025 (GLOBE NEWSWIRE) -- New findings from the Financial Health Pulse® 2025 U.S. Trends Report, released today by the Financial Health Network, reveal that modest and fragile gains in consumer savings and debt management are being undermined by systemic economic risks that threaten to stall or reverse recent incremental progress. The Pulse data spotlights growing concerns about the adequacy of insurance coverage, renewed financial strain from student loan repayments, and the limited reach of emerging digital tools, signaling that while some households may have found some breathing room, the nation’s financial health remains on shaky ground.
Now in its eighth year, the Financial Health Pulse is one of the nation’s leading studies of financial health, drawing on a nationally representative, probability-based panel that surveys more than 7,400 households. The data sorts households into three tiers — Financially Healthy, Financially Coping, or Financially Vulnerable — based on their responses to questions about issues and topics that help drive financial health outcomes. By tracking the same eight indicators year after year, the report provides a unique window into underlying trends that macroeconomic data and other consumer benchmarks may overlook.
Between 2024 and 2025, nearly one in four households reported moving up or down between financial health tiers, with more improving than declining, including roughly 7.7 million that moved from Financially Vulnerable to Financially Coping. Yet, despite this progress, the share of Financially Healthy households has remained flat since 2022 and is well below the temporary highs seen in 2020 and 2021, when extraordinary pandemic-era support briefly lifted financial health nationally. The persistence of these patterns underscores the enduring barriers to long-term resilience and mobility, even in periods of short-term progress.
“After eight years of tracking this data, the lack of meaningful positive movement in Americans’ financial health should be an eye-opening alarm and warning,” said Jennifer Tescher, founder and CEO of the Financial Health Network. “While some households saw marginal improvement between the lower financial health tiers this past year, the gains appear to be very fragile and will be erased by cuts to the safety net, the return of student loan burdens or rising tariffs. Short-term progress is not enough. We need a fundamental shift in policy and a higher standard of accountability from employers, financial institutions, and policymakers to elevate at-risk households and deliver durable financial health for all.”
Key Findings from the 2025 Report:
- Financial health challenges remain entrenched: From 2018 to 2025, the share of Financially Healthy households has hovered around 30%, increasing only temporarily during the pandemic.
- Insurance confidence is falling: Only 56% of households say they are at least moderately confident their insurance would protect them in an emergency, down from 59% the prior year. This continues a downward trend and highlights growing concerns about the adequacy of coverage as households face rising premiums, climate-related disasters, and higher out-of-pocket costs.
- Student loan borrowers are at risk: Households with student loans reported a drop in self-rated credit scores, with the share describing their credit as “good” or better falling from 69% to 65%. The decline reflects the resumption of repayment and renewed reporting to credit bureaus, underscoring how policy shifts can ripple across household financial health.
- Between 2024 and 2025, financial vulnerability declined: The share of Financially Vulnerable households fell to 15% in 2025, driven by improvements in saving and debt manageability: 49% of households reported that they spent less than their income in the past year, up from 47% in 2024, and the share of households with unmanageable debt dropped, due in part to a higher number of households reporting no debt at all.
- Lower-income and lower-wealth households saw notable gains:
- Vulnerability among households with negative net worth fell from 56% to 48%.
- Black households saw a decrease in financial vulnerability from 29% to 24%.
- Renters, low-to-moderate income (LMI) households, and those without investments all experienced improvements.
“This year’s report delivers a wealth of information, both about the financial health of U.S. households and about how their financial lives are changing,” said Andrew Warren, manager at the Financial Health Network and lead author of the report. “We’re seeing growing anxiety about insurance coverage and the financial fallout from resumed student loan payments. At the same time, we see signs of change in how people manage their money, from credit-building tools to automated savings and even AI. These emerging strategies may not be widespread yet, but they will play a critical role in shaping the future of financial health.”
Emerging Trends: Early Adoption, Uneven Reach
As households explore new tools to help manage their finances, this year’s report highlights early but uneven adoption of digital strategies, from AI-powered advice to credit-building services and automated savings features. While these tools and features show promise, their use remains limited, with access and uptake more common among higher-income and more financially secure households.
- The use of AI chatbots for financial advice more than doubled from 3% in 2024 to 7% in 2025, though it remains less common than advice from friends, family, or financial advisors.
- 12% of households used at least one credit-building product in the past year, such as secured credit cards or rent-reporting services.
- Households with automated savings systems were significantly more likely to have at least $2,000 in liquid savings and three months of living expenses set aside.
“The complex interconnections between these findings show that reliable, trustworthy data has never been more critical,” said Jo Christine Miles, Director, Principal® Foundation and Principal® Community Relations. “The Pulse gives business leaders, policymakers, and community organizations a clear view into the financial realities households are facing year after year. At a time when progress is fragile and risks are mounting, this kind of evidence is essential to guide decisions that can meaningfully improve people’s financial lives.”
A Call to Action
Easing inflation and steady employment have offered households temporary relief, yet those gains could vanish just as quickly with renewed price pressures from tariffs and weakening job growth. The report urges employers, financial institutions, policymakers, and community leaders to focus on populations at greatest risk, including those with low incomes, limited assets, and student debt.
Addressing these challenges will require coordinated, sustained action across sectors, as well as greater accountability from institutions themselves. Novel efforts such as Financial Health Network’s recently released FinHealth Standards point to ways the private sector can embrace self-regulation by measuring and improving the financial health of the people they serve.
Whether through public policy or private-sector reform, stakeholders must work together to ensure that recent gains don’t stall and that financial health becomes a priority, not just a possibility, for all.
About the Financial Health Pulse®
Launched in 2018, the Financial Health Pulse® is a research initiative from the Financial Health Network designed to provide actionable insights into the financial lives of Americans. The 2025 Trends Report is supported by the Principal® Foundation and is based on data collected in partnership with the University of Southern California’s Dornsife Center for Economic and Social Research. For full details on the report, please visit: https://finhealthnetwork.org/pulse-trends-2025-charts-and-methodologies/
About the Financial Health Network
The Financial Health Network is the leading authority on financial health. We are a trusted resource for business leaders, policymakers, and innovators united in a mission to improve the financial health of their customers, employees, and communities. Through research, advisory services, measurement tools, and opportunities for cross-sector collaboration, we advance awareness, understanding, and proven best practices in support of improved financial health for all. For more on the Financial Health Network, go to https://finhealthnetwork.org/.
Contact:
Catherine New
Financial Health Network
cnew@finhealthnetwork.org
