Nine reports from paycheck to paycheck, and one inescapable conclusion.

anuj nayarfinancial health officer LendingClubtold PYMNTS in an interview that “we’re seeing a very clear picture that living paycheck to paycheck is the predominant way we live right now, and it’s a misnomer to think that it’s just low-income Americans.”

The conversation came in the context of a joint investigation between LendingClub and PYMNTS that revealed that more than 60% of American households live paycheck to paycheck, meaning we are roughly back to pre-pandemic levels.

See also: Millennial Minute: 70% of Millennials Live Paycheck to Paycheck

As Nayar put it: “The reality is that the number of Americans going from check to check may go back to what we had at the start of the pandemic, but the external environment that is causing all of this is different.”

So think back to March 2020, which feels like three lifetimes ago, when the onset of COVID meant that many low-income people’s jobs, and thus their income, disappeared overnight. But with large volumes of pandemic aid, forbearance programs, and tax relief, the recession ended up being short-lived.

This time, he said, it’s different.

Check-to-check pressures are affecting individuals and families across all income streams, he said. Factors are not moving as fast as what had been seen during the pandemic: inflation is now deeply entrenched and supply chain entanglements are (still) the norm.

As a result, the P2P economy, as we might call it, is now affecting the half of Americans who earn more than $100,000 a year. Credit has been a kind of buffer against macroeconomic headwinds, he said, and has been used by almost all consumers.

“I’m sure even Jeff Bezos has been using credit on occasion,” Nayar said, a bit wryly. In fact, living paycheck to paycheck not only means consumers are struggling to pay bills, but it can also mean people are using credit and other financial services products to make ends meet.

Related: Why ‘Paycheck to Paycheck’ Doesn’t Always Mean ‘Broke’

Looking at the Federal Reserve

But as the Federal Reserve raises interest rates in the coming months, as it seems poised to do, revolving debt is getting more and more expensive.

That would represent a key way to address the approximately $1 trillion in credit card debt that is outstanding. It would also take some of the sting out of the most vulnerable populations.

“There’s a dirty little secret with credit card debt,” Nayar said. “The ones who pay their bills every month and get the rewards points… well, the people who pay for it are the people who don’t pay their bills every month.”

Since higher-income Americans tend to pay off their credit card every month, the effect of the subsidy falls squarely on the shoulders of lower-income Americans, he said.

Read more: Nearly half of consumers earning $100,000 a year live paycheck to paycheck

So more Americans are looking to move to some form of fixed-rate obligations, securing installment loans or other predictable options before bearing those rolling charges becomes even more difficult. Platforms like LendingClub, she said, can help consumers manage their debt and spending more proactively, beyond what traditional banks offer.

Looking ahead, a shift in the way solvency is measured and observed awaits us. The traditional FICO score, he said, is a relic of the 1950s and less relevant in 2022.

“The system has not kept up with the ways Americans live their lives,” Nayar said. Advanced technologies and a host of new alternative data points can go a long way in identifying that creditworthiness and then extending the lowest rates and best terms possible.

Inflation will continue to be a major short-term and long-term headwind, and living paycheck to paycheck will continue to be the dominant tenor of the times.

As Nayar put it, “We’re going to have to look at the economic system itself and find better ways to ensure that money is used to the best possible extent, and how best to manage this inflationary drive.”

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DATA OF NEW PAYMENTS: THE TRUTH ABOUT BNPL AND STORE CARDS – APRIL 2022

About: Shoppers who have store cards use them for 87% of all eligible purchases, but this doesn’t mean retailers should initiate buy now, pay later (BNPL) from checkout. The Truth About BNPL And Store Cards, a collaboration of PYMNTS and PayPal, surveys 2,161 consumers to find out why providing both BNPL and store cards is key to helping merchants maximize conversion.

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