The rest are living in a different world.

The Pinpoint Press Better-Off Index shows a modest improvement in US living standards compared with one year ago. But it’s largely because of stock-market gains. Without stocks, the year-over-year improvement is much weaker. And on the measures that matter most to working-class Americans, the economy is stagnant and probably getting worse.

The Better-Off Index answers the question, are we better off than we were one year ago? The index compiles four basic economic metrics—job growth, income growth, home affordability and stock-market performance—into one number, with values over 100 indicating improvement and values below 100 indicating decline.

The Better-Off Index through April is 108.91, which is an 8.9% improvement over conditions one year earlier. That’s up from 105.63 in March.

But without stocks, the Better-Off Index is just 102.1 for April. And most of that was due to improving home affordability. Growth in employment and real income, adjusted for inflation, was extremely weak, revealing substantial stressors for working Americans who aren’t building wealth through home ownership or stock-market investments.

This disparity illustrates the “K-shaped economy,” with Americans who hold financial wealth representing the upper leg of the K, and doing quite well. They’re benefiting from a huge rally in stocks that’s been going on since late 2023, with the S&P 500 index up 76% since then. Upper-K Americans also tend to be homeowners, and the luckiest of those bought before 2021, allowing them to refinance at the record-low mortgage rates that followed the 2020 Covid pandemic.

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Lower-K Americans are typically workers who rely on a paycheck alone, with little financial wealth to pad their living standards. While slightly more than half of all Americans own stocks, many of those holdings are in retirement accounts that are generally untouchable for working-age people. And even those holdings tend to be small. The wealthiest 10% of Americans own 87% of all stocks, according to Federal Reserve data. The next 40% own about 12%, while the bottom 50% own just 1% of all stocks.

Affordability and inflation are once again top concerns for many Americans. The Better-Off Index accounts for inflation in two ways. The first is real income, which is income adjusted for inflation. As the chart above shows, real incomes were negative for much of Joe Biden’s presidency. That’s because of runaway inflation that peaked at 9% in 2022, which was far higher than nominal income growth.

Real income turned positive late in Biden’s term, and went a bit higher when President Trump took office, largely because inflation fell to a low of 2.3%. But inflation is on the march again, due to Trump’s war with Iran and surging energy prices. Inflation is now 3.3% and almost certainly going higher. Real incomes, as a result, are barely higher than one year ago and will probably turn negative soon.

Home affordability also captures inflation, specifically housing inflation. Home affordability is improving on a year-over-year basis, because mortgage rates are lower than they were in 2025 and the growth in home prices has slowed.

But housing affordability remains poor. It takes 41% of median income to pay for a typical house, according to the Atlanta Federal Reserve, which is far higher than the affordability threshold of 30%. Housing costs have been above the 30% threshold since 2021, when low rates led to a surge of buying, pushing home prices up and up.

Housing affordability is also likely to worsen. The latest data is from February—before Trump launched the war against Iran—when the average mortgage rate was 6%. The Iran war has pushed interest rates higher, with the average mortgage rate now around 6.3%. So home affordability will likely worsen in future data.

Many Americans don’t need charts and indexes to know that their paychecks are stretched. Consumer confidence, by some measures, is close to the lowest levels on record. Trump’s approval rating is sinking, especially on economic issues. His net approval rating on the economy has dropped from +12 to -24, according to YouGov. On inflation, his net approval has crashed from +6 to -44.

If you own stocks, the 28% gain during the last year is a welcome cushion against rising costs and other economic stressors. But many Americans lack economic shock absorbers, which explains the very sour public mood.

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The March rendition of the Pinpoint Press Better-Off Index rose 5.5 points from its February levels. The Better-Off Index measures four economic indicators—employment, real income adjusted for inflation, home affordability, and stock values—compared with levels from 12 months earlier. It answers the basic question, are we better off than we were one year ago?

The main change in the latest index is an improvement in home affordability. The median home price dropped slightly, to about $391,000, according to data from the Atlanta Federal Reserve. Mortgage rates dropped as well, to an average of 6.1%. That added up to a 6.4% improvement in home affordability, year-over-year.

[Four ways Trump’s war is costing you.]

That pushed our Better-Off Index from 116.6 in January to 122.3 in February. Any number above 100 indicates improvement, which is what you’d expect in a growing economy. Numbers below 100 indicate a worsening economy. The last sub-100 index number was in May of 2023, largely because soaring inflation sharply eroded buying power, turning real incomes negative. (Here’s a cool interactive version of these charts.)

The problem with home affordability is the Iran war has put stress on financial markets and quickly pushed interest rates back up. Daily tracking by Bankrate shows the average mortgage rate to be around 6.33% as of March 18.

Long-term rates on most loans have jumped by a similar amount, about one-quarter of a point, since the Iran war began on February 28. The Middle East war has squeezed oil supplies and pushed crude prices up by about 40%, which is likely to force overall inflation higher. When inflation expectations rise, lenders demand higher interest rates to compensate for the deflating value of money.

Despite the recent improvement, home affordability is still lousy. An “affordable” market is one in which a typical mortgage payment requires 30% of median income, or less. The typical monthly payment now requires 41% of median income. But that’s better than the 45% of median income required at the nadir of affordability, in the summer of 2024.

As just about every home buyer knows, home prices spiked during the Covid pandemic, when monetary stimulus by the Federal Reserve drove mortgage rates to the lowest levels in modern times. Record-low borrowing costs led to a buying binge, and the increased demand sent real-estate prices soaring. Then interest rates rose as Covid faded, the economy recovered, and the Fed reined in monetary stimulus.

[Don’t expect the US Navy to solve the oil crisis.]

The housing market is beginning to rebalance, but it could take years before affordability returns to historical norms. Elevated housing costs stress renters too, because higher real-estate values mean higher costs for landlords, who have to charge more for rent.

There’s another warning sign in the Better-Off Index. Employment has improved by just 0.1% year-over-year, the most anemic job growth since the tail end of the Covid pandemic in 2021. In January, the economy actually lost 92,000 jobs. A weak labor market is one of the biggest concerns Americans voice in consumer confidence surveys, which show confidence to be at recessionary levels.

Real incomes are holding up okay, with inflation-adjusted wages up 0.3% from one year ago. But that is also a slowdown from stronger income growth in the middle of 2025. If high oil prices do stoke inflation, real incomes will worsen.

[Tariff inflation out, oil inflation in.]

The one thing that’s been going right during the Trump presidency is the stock market, which is a major source of wealth for older Americans and retirees. The S&P 500 index rose 15.5%, year-over-year, at the end of February, though stocks have also suffered from the Iran war. Since it began, the S&P is down about 2.4%.

As we’ve reported before, the biggest factor helping people get ahead during the Trump presidency is stocks, especially for those not exposed to home affordability pressure. While the overall Better-Off Index is now 122.3, it’s just 106.81 when we strip out stocks and only gauge employment, real income and home affordability.

With a downturn in home affordability now likely in the next set of numbers, there could be no noticeable year-over-year improvement in the economy other than stocks during the next few months. And that’s only if stocks hold up. The war may not be that friendly.

• Current index value: The Pinpoint Press Better-Off Index level for January 2026 is 117.3, which is slightly better than the historical median.

• Stock-market gap: But removing stock-market performance lowers the Better-Off Index to 100.9, which means Americans who lack financial wealth are not getting ahead.

• Job growth slowdown: Total employment in December was just 0.4% higher than one year earlier.

• Home affordability stinks: It’s near 20-year lows.

• This is the K-shaped economy: Stock owners are near the top, while people without stocks are closer to the bottom.

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President Trump sees an “economic boom.” Under his watch, he said in a January 13 speech, “growth is exploding, productivity is soaring, investment is booming, incomes are rising, inflation is defeated.”

His sagging approval ratings suggest many Americans disagree.

The Pinpoint Press has developed a new tool to explain why. The Pinpoint Press Better-Off Index measures how the economy is doing compared with one year earlier on jobs, incomes, home affordability and stock values. Many Americans ask themselves, am I better off than I was one year ago? This index answers the question.

It also provides a stark explanation for who’s getting ahead in America, and who is not. Using all four metrics, the Better-Off Index is currently 117.3. Numbers above 100 mean we’re better off, while numbers below 100 mean we’re worse off. An index of 117 is slightly above the median in data going back to 2006. Things ought to be good.

[See more details about how we built the Better-Off Index]

But removing stocks from the index generates a very different result. Based on jobs, incomes and home affordability alone, the Better-Off Index is just 100.9. So people who don’t benefit from stock ownership are basically no better off than they were one year ago, when Trump began his second presidential term.

It could be worse. In 2022, the Better-Off Index bottomed out at 61. The main problem then, as many Americans recall, was inflation that peaked at 9%. That wrecked real incomes, adjusted for inflation, which is part of the index. Home affordability was drastically worsening, as prices and interest rates both rose. Stocks were selling off, as well.

[More: Voters hate both political parties more than ever]

President Biden, at the time, kept bragging about record job growth, which was true. But purchasing power was collapsing and financial wealth was declining. As the Better-Off index shows, strong job growth totally failed to compensate for everything going wrong. No wonder Biden’s approval rating tanked.

Probing the four indicators that go into the Better-Off Index help explain who’s up and who’s down in the so-called K-shaped economy. Job growth, for instance, is modestly positive, with total employment in December up 0.4% from the level of December 2024. But notice the sharp slowdown in the chart. The pace of job growth has been slowing since 2022 and it’s now close to stall speed, which would be no year-over-year improvement at all. Surveys and a lot of other data clearly show Americans getting skittish about the job market.

Real incomes were negative for most of 2022 and 2023, because inflation rose by more than incomes. Earnings have has since turned positive, with inflation-adjusted incomes about 2% higher now than one year earlier. That may not seem great, but it’s better than the median of the last 20 years.

Home affordability, as measured by the Atlanta Federal Reserve, is near the worst levels of the last 20 years. Home prices during the last four years have risen by far more than incomes, while mortgage rates have risen as well. Compared with one year ago, affordability is slightly worse, mainly because of rising prices.

[More: Inflation moderates, but affordability is still a problem]

Stocks are the standout performer in the Better-Off Index. The S&P 500 index rose 16.4% from the end of December 2024 to the end of December 2025. We weight each metric equally, so including stocks in the index accounts for essentially all of the improvement in the Better-Off Index during the last year. That’s why stripping out stocks shows no improvement.

So if you own stocks, you probably reside on the upper slant of the K-shaped economy. And the more stocks you own, the higher on the slant you are. If you don’t own stocks, you’re most likely on the downward slant.

We’ll update the Pinpoint Better-Off Index monthly and refer to it frequently to help illuminate what’s happening in the Trump economy. As always, we welcome comments and feedback on what you like about The Pinpoint Press and what we can do better.

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We’ve applied some data to the question. The Pinpoint Press constructed a proprietary Better-Off Index to gauge whether ordinary people are better off than they were one year ago. This is an intuitive way many people think about their finances, and it’s also a logical way to gauge the overall direction of the economy.

The Pinpoint Press Better-Off Index encompasses four basic economic metrics. We start with the overall employment level, because that reveals whether jobs are becoming more or less plentiful. We include real income, adjusted for inflation, because it captures whether purchasing power is increasing or decreasing. Home affordability accounts for how readily Americans can start building wealth through home ownership. Finally, we wrap in stock prices, since that accounts for the value of investments and retirement accounts.

[More: Inflation moderates, but affordability is still a problem]

For each of these, we calculate the year-over-year change every month. Then we aggregate those figures into a single index number that represents whether the direction of the economy is better or worse than it was one year earlier. An index number of 100 would indicate no change from one year ago. An index number above 100 represents improvement, while a number below 100 means things are getting worse.

We also do a separate index by stripping out stocks, so that series represents just three things: the 12-month change in employment, real income, and home affordability. That applies more to people who aren’t building financial wealth through stock ownership.

The results validate the affordability crisis and explain why it’s happening, as these charts show.

Since any number above 100 represents a better-off economy, the index number for January 2026—117—looks pretty good. But when you strip out stocks, the index is barely above 100—basically no better or worse than one year ago. And it’s been heading downward since May, which validates the sense many people have that something is going wrong.

What exactly is the problem? Here’s what’s happening with each of the four components of the index:

There have been two important changes during the last few months. The first is the slowdown in employment. Current employment levels are slightly higher than they were a year ago, but the year-over-year improvement has been declining as hiring slows.

[More: Voters hate both political parties more than ever]

Housing affordability, which comes from data collected by the Atlanta Federal Reserve, has deteriorated slightly from levels of one year ago, mainly because the median home price has risen by more than 5%. It takes 43% of median income to pay for the typical home, up from 42% a year ago.

That’s the K-shaped economy in numbers. People who own stocks are better off because the market was up 16.4% at the end of December, compared with one year earlier. If you don’t own stocks, you didn’t enjoy that wealth boost and you’re roughly equal to where you were one year ago. Plus, you sense that jobs are getting more scarce and housing is getting a little more expensive.

Everybody’s circumstances are different, of course. One index can’t speak for everybody. But the Better-Off Index tracks well with developments in the economy during recent years.

[More: Job growth cratered in 2025]

The lowest point in the Better-Off Index during the last five years came in October 2022, when inflation was nearly 8%. That hammered purchasing power and pushed real incomes well below year-earlier levels. Home affordability was worsening, with the average mortgage more than doubling in 12 months. And a stock selloff was eating into wealth, rather than creating it. For 12 months in 2022 and 2023, the Better-Off Index excluding stocks was higher than the index including stocks, as the chart above shows.

These numbers can change fairly quickly, affecting consumer confidence, the direction of financial markets, presidential approval and many other things. The Better-Off Index will show up frequently in future reporting at The Pinpoint Press, as we do our best to explain what’s happening to the fortunes of ordinary people and what policymakers ought to do about it.

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