“THE WORD OF THE YEAR, and what sets us up for 2026, should be ‘resilient,’ because that's how the consumer has performed,” says Liz Everett Krisberg, head of the Bank of America Institute, which publishes monthly “Consumer Checkpoint” reports on the strength of the U.S consumer. Though there is a distinct gap between the spending of higher-income households and lower-income households, “Spending, wages and income continue to grow for both groups,” she adds. “Paying for experiences, such as cruises, concert and sporting events, is high on both groups’ shopping wish lists.”
That said, there are weak spots that bear watching: The top third of higher-income households drive more than half of consumer spending, inflation is a contributing factor to the rise in spending overall, and a quarter of U.S. households currently live paycheck to paycheck, notes Krisberg. Watch the video above as she sits down with Chris Hyzy, Chief Investment Officer for Merrill and Bank of America Private Bank, to break down what, beyond inflation, is driving these spending trends from a geographic, wage and small business owner perspective. “Understanding consumer sentiment and spending can help you identify opportunities and risks to watch out for in 2026,” says Hyzy.
For more insights on the markets and economy in 2026, watch the Outlook 2026 webcast, “Powering up: What could drive the next era of growth?” Find more year-ahead insights in “Outlook 2026: Geopolitics, policy and your portfolio.”
IMPORTANT DISCLOSURES
The opinions expressed are as of 12/4/25 and are subject to change.
This information should not be construed as investment advice and is subject to change. It is provided for informational purposes only and is not intended to be either a specific offer by Bank of America, Merrill or any affiliate to sell or provide, or a specific invitation for a consumer to apply for, any particular retail financial product or service that may be available.
The Chief Investment Office (CIO) provides thought leadership on wealth management, investment strategy and global markets; portfolio management solutions; due diligence; and solutions oversight and data analytics. CIO viewpoints are developed for Bank of America Private Bank, a division of Bank of America, N.A., (“Bank of America”) and Merrill Lynch, Pierce, Fenner & Smith Incorporated (“MLPF&S” or “Merrill”), a registered broker-dealer, registered investment adviser and a wholly owned subsidiary of Bank of America Corporation (“BofA Corp.”).
Bank of America Institute is a think tank dedicated to uncovering powerful insights that move business and society forward. Drawing on data and resources from across the bank and the world, the Institute delivers important, original perspectives on the economy, sustainability and global transformation.
