Securian Financial Study Finds Many Americans Living on the Financial Edge as Economic Pressures Push Borrowers Into “Financial Defense” Mode

Rising costs, persistent economic uncertainty and growing concerns about financial resilience are causing Americans to shift from pursuing financial goals to protecting what they have, according to findings from Securian Financial’s third annual lending environment study.

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The study, which surveyed more than 1,000 current and prospective borrowers nationwide, found that many Americans are financially vulnerable and unprepared for an unexpected disruption to their income. Among borrowers with active loans, 50% said they could continue making loan payments for just three months or less if they suddenly lost their income. Nearly one in five (19%) said they would struggle to make payments in less than one month after losing their income.

The findings come as broader indicators point to increasing financial strain among U.S. households. In February, Reuters reported that New York Federal Reserve data showed household credit troubles worsened at the end of 2025, with rising delinquencies across several forms of consumer debt, underscoring ongoing financial pressures facing many Americans.¹

“Consumers today are navigating an environment marked by higher living costs, uncertainty about future income and growing concerns about their financial security,” said Alexia Johnson, Securian Financial partner development leader for Affinity Solutions-U.S. “What we’re seeing is a shift from financial offense to financial defense. Borrowers are focused less on getting ahead and more on protecting themselves from setbacks that could quickly derail their finances. That creates both a challenge and an opportunity for financial institutions to strengthen trust and provide meaningful support.”

Financial stress remains widespread

The study found that borrowers’ biggest financial concerns are centered on everyday affordability and financial shocks:

• 64% cited rising everyday expenses as a top financial concern.
• 54% cited emergency expenses.
• 41% cited medical expenses.
• 35% cited job loss or reduced income.
• 29% worried about damage to their credit score.
• 26% worried about missing or falling behind on loan payments.

Younger borrowers are a notable exception to conventional assumptions: while Gen Z and Millennials are more likely than older generations to say they feel financially prepared for the unexpected, they are also among the least able to actually sustain loan payments after an income disruption.

Borrowers see value in loan payment protection products but adoption remains low

Despite widespread financial concerns, relatively few consumers have adopted loan payment protection products, which include debt protection and credit insurance. The products cover borrowers’ monthly payments in the event of specific life events such as involuntary unemployment, disability, critical illness or death.

Only 22% of borrowers reported having purchased a loan payment protection product from their lender, even though:

• 77% said such products provide helpful financial security.
• 74% said they can help people stay on track financially.
• 71% said they are something responsible borrowers should consider.

At the same time, skepticism remains. Nearly half (48%) believe loan payment protection is a way for lenders to make more money, and one-third (33%) said it can feel like a “junk fee.”

The findings suggest that many consumers recognize the value of protection products but remain uncertain about how they work, whether they are worth the cost and whose interests they ultimately serve. For borrowers, that uncertainty leaves a real protection gap. For lenders, it represents a missed opportunity to build lasting trust.

“Loan payment protection isn’t a silver bullet, nor should it be positioned that way,” Johnson said. “But when consumers are worried about how they would manage their financial obligations after a job loss, disability or other unexpected hardship, these products can provide an important layer of protection. The challenge for lenders is helping borrowers understand the value in a transparent, supportive and trustworthy way.”

Trust matters more than ever

The research found that financial institutions face a growing trust challenge as consumers look for support during periods of financial hardship.

While borrowers expect transparency, disclosures and fair pricing, they increasingly judge lenders based on how they behave when customers face financial difficulties.

Among respondents:

• 90% said they would be likely to stay with a financial institution long term if a loan payment protection product helped them through a difficult time.
• 85% said financial institutions should help borrowers prepare for unexpected financial hardships.
• 85% said their trust in a lender would increase if the institution helped cover loan payments during a hardship through a loan payment protection product.
• 85% said they would be likely to recommend that institution to others.

The study also revealed that trust is shaped by borrower experience more than traditional product disclosures. The factors most likely to influence trust in lenders offering payment protection were the cost of protection (52%), clear explanations of how the payment protection product works (40%), coverage details (38%) and transparency around loan terms (37%).

Generational differences reveal varying trust needs

The study found notable differences in how generations view financial protection products and lender relationships.

Gen Z borrowers are the most likely to purchase loan payment protection (31%) and report familiarity with the products, but they are also the most likely to find them confusing.

Boomers, meanwhile, are the least likely to purchase protection products (15%) and the most skeptical. More than half (51%) believe loan payment protection primarily serves as a revenue generator for lenders.

The findings suggest lenders may need different trust-building strategies for different generations, balancing digital convenience and educational support for younger borrowers with proof of value, transparency and practical examples for older consumers.

What lenders can do

Based on the findings, Securian Financial identified several opportunities for lenders seeking to strengthen borrower trust and better support financially vulnerable consumers:

• Move beyond compliance-focused communications and explain products in plain language tied to real-life scenarios.
• Help borrowers understand their financial vulnerabilities rather than assuming confidence equals preparedness.
• Position protection products as part of a broader financial support ecosystem that includes hardship assistance, payment flexibility and financial wellness resources.
• Create hybrid experiences that combine digital convenience with access to human guidance when borrowers have questions.
• Tailor communications and trust-building approaches to the different needs and expectations of each generation.
• Share real-world examples and outcomes that demonstrate how support programs help borrowers during periods of hardship.