A Scorecard: How Has the U.S. Done in the Last 5 Years on Financial Services for Low-Income Households?
April 2026
Overall Takeaways: Banking access is the clearest success story. Health insurance improved significantly but faces policy reversal. Credit access is expanding but remains costly and fragile. Homeownership is stable for those already in, but closing fast for those trying to enter. Savings, property insurance, and legacy planning are either flat or declining — and in each case the barrier is awareness, behavior, or product quality, not policy.
| Area | Trend | What and Why? |
|---|---|---|
| Banking, Savings & Payments | ||
| Banking Access | ↑Better |
4.2% of U.S. households are unbanked, a record low — down from 5.4% in 2019.
Mobile banking has been the key driver: 48% of banked households now use it as their primary channel, up 9x in a decade. Bank On-certified accounts opened 4.8M in 2024, a 27% jump year over year. The true unbanked share may be even lower: FHN's analysis suggests the rate drops roughly 25% further when non-traditional products offering full banking functionality (e.g., Chime, PayPal, Cash App) are counted. Two gaps persist: Black households remain 5x more likely to be unbanked than low-income white households, and low-income households still pay overdraft fees at 3x the rate of higher-income ones (34% vs. 10%), though overdraft revenue fell $6 billion from pre-pandemic peaks as no-fee alternatives expanded.
Sources: FDIC 2023; St. Louis Fed Bank On Report 2024; CFPB Overdraft Report 2024; Financial Health Network Un- and Underbanked Measurement Brief 2025
|
| Savings & Liquid Assets |
→Mixed |
The ability to cover unexpected expenses has flatlined: 63% of adults could cover a $400 emergency with cash in 2024, unchanged from 2022–2023 and down from a 68% peak in 2021. Only 13% said they could not cover a $400 expense at all; 69% had enough savings for an expense of $500 or more.
The commonly cited $400 figure is often misconstrued — only 13% of adults said they flat-out couldn't cover it. But the broader picture is still concerning: 30% of adults could not cover three months of expenses by any means, and for low-income households, excess pandemic-era savings were largely depleted by mid-2022. Persistent inflation and wage stagnation are the main reasons savings haven't recovered. Workplace savings programs (62% employee adoption; about $1,000 saved per participant in Year 1) and new SECURE 2.0 emergency savings provisions offer promise, but have not yet reached meaningful scale.
Sources: Federal Reserve SHED 2024 (May 2025); San Francisco Fed 2023; SecureSave 2024; Financial Health Network 2025
|
| Credit & Debt | ||
| Credit Scores & Access |
→Mixed |
53% of adults in low-income areas have credit scores below 660 today, vs. 24% nationally. After improving during 2020 and 2021, delinquencies among low-income borrowers climbed again in 2023 as inflation eroded earlier gains.
Pandemic-era stimulus and forbearance programs temporarily boosted scores, but rising costs of living pushed low-income borrowers back into delinquency by 2023. On the access side, progress has been real: only 2.7% of adults now have no credit file at all (CFPB 2025). Earned wage access reaches 55M+ workers, and credit builder loans deliver an average 28-point score improvement. One untapped lever stands out: 90% of lenders say using rent and utility payment history would help approve more qualified borrowers, but only 43% currently do.
Sources: St. Louis Fed Q1 2025; NY Fed 2024; VantageScore 2024; CFPB 2025; Nova Credit 2024
|
| Credit Card Delinquencies & Other Short-Term Debt |
↓Worse |
Credit card delinquency rates are now roughly 125 basis points above pre-pandemic levels, with total balances 38% higher than in 2019 ($1.27T vs. $927B). The CFPB found the increase was driven primarily by lenders extending credit to riskier borrowers, not by a broad deterioration in consumer behavior.
Lenders loosened underwriting standards during 2021–2023, originating cards further down the credit spectrum. Cards issued in those years went delinquent significantly faster than cards originated in other years. Low-income and subprime borrowers bore the brunt: they were more likely to receive new cards and more likely to fall behind. Meanwhile, Buy Now, Pay Later usage surged from under 1% of adults in 2019 to 15% today, adding another layer of short-term debt that typically doesn't report to credit bureaus and doesn't help borrowers build credit history. Overall delinquency rates began moderating in late 2025, but remain elevated for lower-income households.
Sources: CFPB Blog Jan. 2025; NY Fed Household Debt Report 2025; St. Louis Fed 2025; Boston Fed 2025
|
| Investing & Wealth Building | ||
| Retail Investing | →Mixed |
54% of low-income households are now retail investors, a 2.9x increase since 2020. But the average equity investor underperformed the S&P 500 by 848 basis points in 2024, and LMI investors face additional headwinds that likely widen that gap further.
The surge was driven by zero-commission trading apps, fractional shares, crypto accessibility, and pandemic-era stimulus cash entering the market. But LMI investors are disproportionately concentrated in crypto, options, and meme stocks (FINRA 2025). 51% of low-income crypto investors have since exited their positions vs. 32% of middle-income investors, consistent with buying late and selling at a loss. Investment activity is windfall-driven (tax refunds, bonuses) rather than systematic, and 62% of younger investors say big risks are necessary to reach their goals. Participation is up, but the quality of that participation remains a serious concern.
Sources: Commonwealth / BlackRock Foundation 2025; JPMC Institute 2024; FINRA Foundation 2025; DALBAR 2025
|
| Retirement Savings | ↑Better |
Significant improvements are forecasted thanks to SECURE 2.0, effective January 2025, requiring all new 401(k) plans to auto-enroll. Currently 95% of earners $150K and up participate in 401(k)'s — but only 40% of earners under $15K do.
The expected improvement is driven entirely by SECURE 2.0's auto-enrollment mandate, since the data shows auto-enrollment alone raises participation from 14% to 77% for the lowest earners. Without it, only 14% sign up voluntarily. One caveat: Wharton Pension Research Council research suggests savings automation can create liquidity risks for low-income workers, and accumulated auto-IRA balances may affect Medicaid eligibility. State-based auto-IRA programs (now active in 20 states, ~1.2M accounts, $2.8B in assets) may help mitigate some of these challenges, but remain underexplored.
Sources: Vanguard How America Saves 2025; PSCA Annual Survey 2025; SECURE 2.0 Act; Chin, Johnson & Middlewood, Wharton PRC 2024; Georgetown CRI 2026
|
| Homeownership | →Mixed |
Although low-income homeownership has risen 5.8 percentage points since 2015 to present, home prices are up 50% since 2020. As a result, the first-time buyer share hit a record low of 21%, and the median first-time buyer age hit a record high of 40.
Earlier gains were driven by pandemic-era low mortgage rates and expanded lending programs, but the affordability reversal since 2022 (rate hikes to 7.8%, home prices up 50%) has stalled progress for new buyers. Below-median-income households own at just 52.4%, and 21 million homeowners are now cost-burdened (25% of all homeowners, a 15-year high). Housing costs consume 47% of median household income, exceeding pre-2008-crisis peaks. For low-income households who already own, the picture is stable. For those trying to buy, the window is narrowing quickly.
Sources: Census Bureau CPS/HVS Q4 2025; Minneapolis Fed 2024; NAR Profile of Home Buyers 2025; Harvard JCHS State of the Nation's Housing 2025
|
| Insurance & Protection | ||
| Health Insurance |
→Mixed |
The U.S. uninsured rate fell from 9.7% in 2020 to 8.0% in 2024 — 4.4 million fewer Americans without coverage — driven by record ACA marketplace enrollment. These gains are now at risk: CBO projects 8.6 million more uninsured by 2029 following $900B in enacted Medicaid cuts.
The improvement was driven by enhanced ACA subsidies (including $0 premiums for those under 150% FPL), marketplace enrollment nearly doubling from 11M to 21.4M, and seven additional states expanding Medicaid. But the Medicaid continuous enrollment provision has ended, the enhanced ACA subsidies expire after 2025, and the reconciliation law's work-reporting requirements are projected to strip coverage from 5.3 million people by 2034. The uninsured rate among children already ticked up from 3.9% to 5.1% in 2024. The five-year progress has been real, but the forward outlook has deteriorated sharply.
Sources: Census Bureau CPS 2025; CDC/NCHS 2025; KFF 2025; CBO Reconciliation Estimate Oct. 2025; CBPP 2025
|
| Renters & Homeowners Insurance |
↓Worse |
The homeowners insurance coverage gap has doubled in five years — from 7% uninsured in 2019 to 14% today. Renters insurance coverage, which briefly improved, is slipping back: 45% of renters remain uninsured, up from 43% in 2020.
Climate-driven premium spikes are the main factor: national homeowners premiums rose 24% over three years, with some markets exceeding 200% increases in 2024. Low-income households can't absorb these costs, and major insurers are exiting high-risk markets entirely. For renters, nearly half of the uninsured mistakenly believe their landlord's policy covers their belongings — a knowledge gap that compounds the access problem.
Sources: III 2024; LendingTree 2024; Fed SHED Oct. 2024; Consumer Federation of America 2024
|
| Legacy Planning Wills, Estates & Trusts |
↓Worse |
The share of low-income households with a will has fallen — from 25% in 2020 to 21% in 2024 — even as online tools have made estate planning cheaper than ever.
The decline is driven almost entirely by an awareness gap: nearly half of low-income households believe they don't have enough assets to need a will. Only 8% of households earning under $40K have any estate plan at all, vs. 34% of those earning over $150K, leaving families exposed for what they do have: savings accounts, cars, custodial rights for children and pets. The cost barrier has largely been solved by digital tools, but awareness has not followed. One likely factor: elderly populations, who have the most urgent need for estate planning, are disproportionately not adopting these digital tools — and that population is growing. Black households are especially affected, as the racial wealth gap means intestacy laws disproportionately erode already-limited intergenerational transfers.
Sources: Trust & Will 2025; Caring.com 2024
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