Read our full analysis for a more in-depth look at these trends.
Inside consumers’ wallets
Lower-income households face the highest inflation, while higher-income cohorts have increased their share of discretionary spend.
December 2025
Key takeaways
- Lower-income households continue to face the highest inflation rates, even as the gap with the higher-income cohort has narrowed since 2024. Price pressures remain concentrated at the lower end, signaling continued strain on household budgets.
- Not every consumer basket looks the same. Lower-income consumers tend to spend more on necessities, like food and shelter. And, as rising housing costs eat into discretionary budgets, Bank of America payments data finds shelter has been the most persistent upward mover in consumer baskets over the past three years.
- Where else has wallet share increased? Entertainment and online retail remain bright spots for lower-income groups, but overall discretionary share growth is increasingly skewed toward those of higher incomes. In fact, these consumers have boosted restaurant and travel spending compared to 2019, while those earning <$50K have cut back on dining out and clothing.
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