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BoA card data in August suggests stark and widening differences in income and spending growth across income cohorts; spending growth is weakest amongst GenZ and GenX

September 12, 2025 //  by Finnovate

Total credit and debit card spending per household increased 1.7% year-over-year (YoY) in August, after a gain of 1.8% YoY in July, according to Bank of America aggregated card data. Seasonally adjusted spending per household rose 0.4% month-over month (MoM), the third increase in a row. We continue to see stark differences in income and spending growth across income cohorts, with the divergence in after-tax wage and salary growth widening again in August. Spending growth is weakest amongst younger generations and Gen X. The weakening labor market appears to be impacting younger people, particularly because changing jobs no longer results in as big of a pay bump. Some relief for the younger generations could come from easing housing costs. Our measure of new rent payments suggests they are dropping back, perhaps as households trade down. If sustained, this may help narrow the gap between the stronger spending growth of homeowners versus renters. Furthermore, the median deposit level of all generations also remains high compared to 2019 levels in Bank of America internal data. So, this would suggest to us that households do not appear to be running down their savings. For now, the recent slowdown in the labor market is not obviously being reflected in households’ overall finances.

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Category: Innovation Topics, Other Topics

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