According to a recent poll from Yahoo Finance and Marist, about 80% of consumers are worried about how tariffs could affect their personal finances. In response, many respondents said they’re planning to pull back on spending. 

Little reminder? Consumer spending is around 70% of this economy, give or take.

Consumers are human. And Ayelet Fishbach at the University of Chicago said how humans feel, affects how we behave.

“Worries about the economy influence consumption behavior just as much as, often even more than, actual negative economic events,” Fishback said.

When people worry the economy is bad, or about to get bad, like many are now, they often get more cautious about spending.

“Even though nothing bad happened yet,” Fishbach said.

That can become a self-fulfilling prophecy. If we spend less because we’re worried the economy is slowing down, we can cause the economy to slow down.

Suzanne Shu at Cornell says people often pull back even if they don’t have to.

“When there's high uncertainty, people feel like they need to save the money for what could come next and put off the spending that doesn't feel as absolutely critical to day-to-day life,” Shu said.

That’s why Wendy Edelberg, at the Brookings Institution, used to pay close attention to how consumers were feeling.

“It used to be my job to forecast consumer spending for the Federal Reserve Board, and I watched the consumer confidence data like a hawk,” said Edelberg.

It was a very strong indicator of where consumer spending was headed, she said. But, since the pandemic, “The link has just broken,” she said.

This happened in 2021 and 2022, when inflation started climbing and hit its peak — consumers were very negative about the economy, but they just kept on spending.

It’ll take a while to know why that link broke, and if it’ll stay broken, Edelberg said. But her theory is: “The level of anxiety about the broader world, I think ramped up during the pandemic, and I think it's stayed really elevated because of politics,” said Edelberg.

That general anxiety could be influencing how people feel about the economy, even if their own situation is actually OK.