Consumer Checkpoint

Higher-income pullback

Headshot of David Tinsley

David Tinsley

Headshot of Anna Zhou

Anna Zhou

Headshot of Taylor Bowley

Taylor Bowley

Headshot of Liz Everett Krisberg

Liz Everett Krisberg

May 2023

Key takeaways

  • April data presents further signs that consumer spending is softening. Bank of America total card spending per household dropped to -1.2% compared with April 2022, the first negative year-over-year (YoY) reading since February 2021. Seasonally-adjusted spending rose +0.3% in April month-over-month (MoM).
  • The aggregate labor market picture remains solid, but Bank of America data suggests some deterioration at the higher end of the income distribution. Unemployment is rising fastest amongst higher-income households, while their pay growth is weakest. Higher-income spending growth on discretionary items has also fallen below lower- and middle-income households.
  • The good news is that savings buffers remain elevated. Bank of America internal data on household savings and checking balances shows the median balance continues to be over 40% higher than the average in 2019 across all income cohorts.

Read our full analysis for a more in-depth look at these trends.

Consumer Checkpoint is a regular publication from Bank of America Institute. It aims to provide a holistic and real-time estimate of U.S. consumers’ spending and their financial well-being, leveraging the depth and breadth of Bank of America proprietary data. Any such Bank of America proprietary data is not intended to be reflective or indicative of, and should not be relied upon as, the results of operations, financial conditions or performance of Bank of America.