Nearly half of Americans believe they won’t be approved for a credit card, mortgage, or car loan, according to a new survey by the Federal Reserve Bank of New York released Monday.
Record-High Credit Concerns
The survey found that 46% of Americans are worried about credit denials, while 8.5% have already refrained from applying for credit because they believed they wouldn’t be approved. This marks the highest level since the survey began 12 years ago.
Additionally, the likelihood of Americans being able to come up with $2,000 for an emergency dropped to 62.7%, a new series low, highlighting growing financial instability.
Recession Fears and Trump’s Trade Policies
Concerns about economic downturns have been exacerbated by President Donald Trump’s trade policies. His tariffs on Canada and Mexico have led to uncertainty, with 56% of Americans disapproving of his handling of the economy, according to a recent CNN/SSRS poll.
A Reuters/Ipsos poll earlier this month found that 70% of Americans believe Trump’s tariffs will drive up the cost of living, and over 50% say his trade policies are too “erratic.”
Consumer Sentiment Hits New Lows
The latest University of Michigan survey reported that consumer confidence has fallen to its lowest level since November 2022. Experts cite uncertainty in economic policies as a key factor in declining sentiment.
“Frequent gyrations in economic policies make it very difficult for consumers to plan for the future,” said Joanne Hsu, director of Surveys of Consumers.
Carl Weinberg, chief economist at High Frequency Economics, echoed these concerns, saying the survey reflects the “Great Uncertainty” caused by Trump’s policies, which may lead consumers to spend cautiously until clearer direction emerges.
White House Defends Economic Policies
Despite growing concerns, the Trump administration maintains that the president’s economic agenda has fueled job creation and investment growth.
“Since President Trump was elected, industry leaders have responded to his America First economic agenda of tariffs, deregulation, and the unleashing of American energy with trillions in investment commitments,” said White House spokesperson Kush Desai.
Preparing for a Possible Recession
Though the U.S. is not currently in a recession, experts advise Americans to prepare for economic instability. Financial advisor Kyle Newell suggests increasing savings and building an emergency fund.
“We want to make sure people have enough cash reserves to live, hopefully without having to touch a 401(k),” Newell told Time.