Zwier and Martinez are not alone. For millions of Americans, the cost of living has risen sharply in recent years, fueled by a mix of persistent inflation, high interest rates<\/a>, soaring energy costs <\/a>and consumer price increases due to tariffs.<\/a> <\/p>\n More than half of respondents in a recent NBC News poll<\/a> said they have changed the groceries they buy in order to stay within their budgets. In the same survey, the cost of housing and the cost of food ranked as the top two economic problems respondents said their families were facing.<\/p>\n This affordability crisis continues despite recent signs pointing to a resilient economy. The S&P 500 and Dow Jones stock indexes both closed at record highs<\/a> on Christmas Eve. And newly released data showed that GDP grew 4.3% in the third quarter<\/a> of the year, much more than economists had been expecting.<\/p>\n ‘Falling behind’<\/p>\n The spoils of a booming stock market are not being distributed evenly. Economists say consumers are separating into two distinct tiers \u2014 what they\u2019re calling a K-shaped economy.<\/p>\n \u201cThe K-shape economy means that some Americans, usually the wealthiest Americans, are doing just fine,\u201d said Heather Long, chief economist at Navy Federal Credit Union. \u201cThey\u2019re in the top of the K. Their incomes are rising. Their spending is rising.\u201d<\/p>\n But many on the lower end of the \u201cK\u201d are finding their paychecks can\u2019t keep up with rising costs of food, housing, utilities and child care.<\/p>\n \u201cThey feel like they\u2019re falling behind, or, if on a good day, maybe treading water,\u201d said Long.<\/p>\n To keep their expenses in check, Zwier and Martinez have cut back on eating out.<\/p>\n \u201cMaybe once every three months now, we\u2019ll go out,\u201d said Martinez. \u201cUsed to be at least date night here and there. But that\u2019s something we\u2019re now sacrificing because everything is just too expensive.\u201d<\/p>\n Zwier and Martinez are part of a broader pullback in restaurant spending<\/a> \u2014 one that is taking a bite out of fast-casual spots like Chipotle<\/a>, Cava<\/a> and Sweetgreen<\/a>.<\/p>\n \u201cA lot of the chain restaurants have had a hard time in this environment where people don\u2019t want to pay $15 to $20 for a burrito or a salad,\u201d said Long.<\/p>\n The K-shaped shift has also drawn the attention of Federal Reserve Chair Jerome Powell.<\/p>\n \u201cWe\u2019re seeing people tightening their belts, changing products that they buy, buying less,\u201d Powell said at a recent press conference in Washington.<\/p>\n And the price pinch many consumers are experiencing this year goes beyond food.<\/p>\n Zwier and Martinez have seen their electric and gas bills skyrocket. \u201cWe\u2019re using less, and it costs more,\u201d Zwier said.<\/p>\n Across the country, electricity costs have jumped 6.9%<\/a> in the last year, more than twice the rate of inflation, according to the Bureau of Labor Statistics.<\/p>\n This winter, U.S. households could spend an average of $995<\/a> on home heating alone, an increase of $84<\/a> from 2024, according to the National Energy Assistance Directors Association.<\/p>\n \u201cThese increases may not sound dramatic to higher-income households,\u201d said Mark Wolfe, executive director of NEADA. \u201cBut for families already struggling, they are devastating.\u201d<\/p>\n Budget boom<\/p>\n Budget retailers and grocers like Costco<\/a>, Walmart<\/a> and Aldi are well positioned to benefit from shifting spending habits among higher- and middle-income consumers.<\/p>\n \u201cWe\u2019re seeing shoppers across all demographics and income levels turning to Aldi, because the simple truth is that no one wants to pay more for groceries than they have to,\u201d an Aldi spokesperson said in a statement to NBC News.<\/p>\n Aldi has seen explosive growth over the last decade. The grocer said it operated 1,230 U.S. stores<\/a> in 2012. That number had nearly doubled to around 2,400 U.S. stores in 2023. And Aldi plans to expand further with 800 new stores nationwide by 2028.<\/p>\n The discount supermarket chain has gained a reputation for low prices and a bare-bones approach. Coin-operated shopping carts, few name-brand products and items shelved in cardboard containers and crates are all part of the Aldi experience.<\/p>\n The promise of low prices draws shoppers like Michael Torres, who said he has been coming to Aldi for the last couple years. Torres and his wife, who have a 1-month-old daughter, are finding ways to make ends meet on an income of less than $50,000 a year.<\/p>\n \u201cAs much as you can save is important,\u201d Torres said outside a New Jersey Aldi earlier this month. \u201cYou still want to make sure you have the fridge full, whatever you need on the table.\u201d<\/p>\n \u201cThere\u2019s wants and there\u2019s needs,\u201d he added. \u201cIf you need something, you get it.\u201d But for now, he said, some \u201cwants\u201d may have to wait.<\/p>\n Two tiers<\/p>\n As many Americans pull back on spending, the U.S. economy has become increasingly dependent on high-income households.<\/p>\n The top 10% of earners were responsible for a record 49.2% of total U.S. consumer spending in the second quarter of this year, according to Moody\u2019s Analytics.<\/p>\n Many businesses are seeing strong demand for their premium fare. Ford and General Motors recently reported soaring sales<\/a> for their biggest and priciest SUVs.<\/p>\n Some companies are also building out their higher-end offerings to draw in big spenders.<\/p>\n This month, American Airlines debuted a splashy new plane<\/a> with lie-flat seats and Bluetooth connectivity while budget carrier JetBlue just opened its first airport lounge<\/a>.<\/p>\n But economists warn that relying on a tiny slice of Americans to drive consumer spending could put the U.S. on shaky footing. Consumer spending makes up the lion\u2019s share of the nation\u2019s total economic activity.<\/p>\n \u201cWhether the economy goes into a recession in 2026 hinges almost entirely on the top 20%,\u201d said Navy Federal Credit Union\u2019s Long. \u201cIf they do well, the overall economy does well. If they don\u2019t, then we\u2019re looking at a recession.\u201d<\/p>\n In the meantime, she said, everyone else could face growing pressure.<\/p>\n \u201cWage gains are going to keep getting smaller, and inflation, those basic costs, are going to keep ticking up,\u201d said Long.<\/p>\n \u201cThat\u2019s a recipe for middle-class squeeze.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Newlyweds Brittany Zwier and Frank Martinez are starting their life together looking for ways to save money. Zwier,…\n","protected":false},"author":2,"featured_media":375222,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164],"class_list":{"0":"post-375221","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-au","9":"tag-australia","10":"tag-business","11":"tag-economy"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/375221","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=375221"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/375221\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/375222"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=375221"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=375221"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=375221"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"Brittany](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/12\/251227-Zwier-Martinez-ch-1332-ae4350.jpg\")
Newlyweds Brittany Zwier and Frank Martinez are starting their life together looking for ways to save money.Courtesy Brittany Zwier<\/p>\n![\"Brittany](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/12\/251227-Aldi-ch-1250-6793f2.jpg\")
Brittany Zwier and Frank Martinez’s grocery cart at Aldi. The chain does not provide traditional supermarket shopping bags.NBC News<\/p>\n![\"Michael](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/12\/251227-ROMANS-MICHAEL-TORRES-ch-1248-518863.jpg\")
Michael Torres and his wife, who have a 1-month-old daughter, have been coming to Aldi for the last couple years.NBC News<\/p>\n![\"Aldi](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/12\/251227-aldi-ch-1254-a78cdf.jpg\")
An Aldi grocery store in Williamsport, Penn., on Sept. 7.Paul Weaver \/ LightRocket via Getty Images file<\/p>\n