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How Americans Pay Their Bills Report: 2023

Today we released a new report that shows that inflation is not only impacting consumers’ ability to pay their household bills, but that they are worried about the long term impact it will have on their financial health. Coming on the heels of the Federal Reserve Board’s Economic Well-Being of U.S. Households report, which showed that rising prices have dramatically impacted overall household finances in a negative way, doxo’s analysis similarly finds that three in four consumers (73%) say that inflation is impacting their ability to pay bills. 86% of consumers said they are worried about the impact that inflation will have on their financial health in the future, with 72% saying it would take six months or more until their household’s financial health improves. 

doxo’s second annual How Americans Pay Their Bills Report also offers in-depth findings and analysis of demographic data and behavior of the US bill pay consumer, and reveals that the average household in America now spends $24,557 per year, or 35% of their income, on the most essential bills. 

Key Findings from the report revolve mostly around the stress and anxiety that paying bills causes the consumer, especially during this trying economic time. They include, but are not limited to the following themes:

Inflation is making paying bills harder for consumers: 

  • 86% of consumers are worried about the impact that inflation is having on their financial health
  • 73% reveal that inflation is impacting their ability to pay bills
  • 72% said it would take six months or more until their household’s financial health improves

Because of inflation, consumers are most concerned with their ability to pay the following bills:

  • 73% – Utilities
  • 63% – Auto insurance
  • 63% – Cable & Internet 
  • 62% – Mobile phone 
  • 51% – Alarm & Security
  • 50% – Health insurance 

Bills eat up a significant portion of total household income: 

  • Household bills make up more than a third (35%) of the average household income [with average household income of $70,784 and average annual bill spend of $24,557 ($2,046 per month) up slightly from $24,032 ($2,003 per month) last year]
  • 23% of consumers said they feel relieved when paying their bills
  • 16% reporting bill pay makes them feel anxious or stressed

Cash is not king when it comes to bill pay: 

  • The average household pays nine bills per month, with 14% of households delaying at least one bill per month 
  • 27% of bill payers have variable income from month to month, which makes making bills in a consistent manner difficult
  • 60% of bills are paid with cards (credit, debit, prepaid) vs. cash, check or ACH 

Credit score remains a cause for concern: 

  • For the second year in a row, “impact to credit score” remained the top concern among U.S. consumers when it comes to paying their bill, at 86%
  • “Stolen payment information” and “identity fraud” closely followed, at 85% and 84% respectively
  • “Late fees” (71%) and “overdraft fees” (59%) were also concerns for a majority of bill paying consumers 

Who pays the bills: 

  • Women are more likely to manage household bills than men, with 53% of bill payers being female, while 47% are male. 

When consumers pay their bills: 

  • Using anonymized data from doxo’s 8 million users, the report breaks down the days and times that consumers are most likely to pay their bills. 
  • The window between 10am and 12pm is when individuals are most likely to make payments. 
  • Monday and Friday are the most popular days to make bill payments, while most consumers take a break from payments and paperwork on the weekends (Saturday and Sunday are the least popular). 

How consumers pay their bills

Payment instruments: 

  • More than 70% of consumers use ACH (direct bank account transfer) to pay their health insurance and life insurance bills but, when it comes to Rent payments, only 31% of consumers use ACH 
  • Cash is also disproportionately used to pay Rent (16%); while cash payment for other bills is nominal (between 1% and 3% of the time)
  • Debit cards are also used to widely varying degrees, with only 12% of respondents using a debit card to make mortgage payments, and 29% of respondents using a debit card to make electric bill payments

Payment practices: 

  • While websites account for the largest chunk of usage for the majority of bills, with the remaining percentage (over 50%) split between other platforms, including bank bill pay, phone payments, mail-in payments, and even in-person payments
  • Rent, in particular, sees a large percentage of real-life payments: 25% of consumers pay their rent checks in person

Payment prompts & improvements to the bill pay experience: 

  • Consumers most prefer email reminders, with 64% of respondents wanting the feature from their bill pay platform
  • Increasingly consumers expect the ability to pay through a mobile app, with 62% saying it improves the bill pay experience 
  • To-do lists were the next improvement consumers wanted to see, at 59% 

How Americans Pay Their Bills

This report examines who the bill pay consumer is, and how and when they pay their household bills. When it comes to bill pay practices, the report shows, there is no normal.