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Middle-income Americans are spending less due to recession worries, Primerica says – InsuranceNewsNet


DULUTH, Ga. — Primerica, a leading financial services provider in the United States and Canada, released the Middle-Income Financial Security Monitor for the second quarter of 2022 — a nationwide survey that measures shifts in consumer sentiment. middle-income families in the United States about their finances.

The survey found that middle-income households are taking proactive steps to secure their finances as they prepare for a possible recession. About three-quarters (77%) think the country will be like this by the end of the year, and most Americans are preparing by cutting back on spending, delaying major purchases or planning to work longer before retirement.

“Middle-income families are taking a hard look at their finances right now. Rising costs continue to eat away at their bottom line amid renewed worries of a recession,” said Glenn J. Williams, CEO of Primerica. “For 45 years, we have been helping working families prepare for these types of situations. We reassured them that professional financial advice is not just for the wealthy. It is essential to their long-term planning and can support their efforts to weather a possible economic downturn. »

Key Findings from Primerica’s Middle Income US Financial Security Monitor

  • Inflation is the main concern. The economy continues to be a major stressor for middle-income Americans, with 41% inflation the top concern. Paying for food and groceries is also high (26%, up four percentage points since March), as is their current financial situation (25%, up eight percentage points since March).
  • Most plan to cut spending. Nearly three-quarters (71%) say they are reducing restaurant/takeout meals, up from 57% in March. Almost the same number (69%) say they plan to keep their current technology instead of upgrading it, up from 44% in March. And about half (49%) plan to budget or cut back on grocery spending, up from 37% in March.
  • Reassess major purchases. Overall, more than a third (38%) have already put off a major purchase because of rising interest rates, including the biggest Fed hike in nearly 30 years. Yet around the same percentage (39%) say they plan to take a vacation in the next 12 months.
  • Many are rethinking their future financial plans. Forty-two percent say they plan to work longer before retirement, and three-quarters (75%) of employed middle-income Americans say they don’t think they have enough savings to retire comfortably, up 10 percentage points since March. In addition, one in five people plan to find a better paying job (22%).

Data on main trends

June 2022 Tue.

2022

Dec. 2021 August 2021 Apr. 2021 Dec. 2020
How would you rate the state of your personal finances? (Mark “Excellent” and “Good” responses.)

Q2 2022 survey: Confidence in personal finances has been on a downward trend since April 2021.

54% 60% 64% 65% 67% 57%
Overall, would you say your income is…? (Report on “Falling behind the cost of living” responses.)

Q2 2022 survey: Concern about the rising cost of living is on the rise.

75% 67% 68% 65% 56% 59%
Do you have an emergency fund that would cover an expense of $1,000 or more (for example, if your car breaks down or you have a large medical bill)? (Mark “Yes” responses.)

Q2 2022 survey: About the same percentage have an emergency fund that would cover an expense of $1,000 or more.

61% 62% 60% 65% 66% 56%
How do you rate the economic health of your community? (Reporting “Not so good” and “Poor” responses.)

Q2 2022 survey: The economic health of communities tends to deteriorate.

58% 52% 50% 54% 52% 57%
How would you rate your ability to save for the future? (Reporting “Not so good” and “Poor” responses.)

Q2 2022 survey: More than 70% believe it will be difficult to save for the future, an increase from previous polls.

72% 66% 62% 63% 58% 65%
In the past three months, has your credit card debt…? (Reporting “augmented” responses.)

Q2 2022 survey: Credit card debt is at the highest point in Monitor’s history.

29% 25% 28% 21% 18% 25%

About Primerica’s Middle Income Financial Security Monitor

The Monitor is a quarterly national survey designed to monitor the financial health of people with annual household incomes between $30,000 and $100,000. Change Research conducted an online survey June 4-6, 2022. Using dynamic online sampling, Change Research surveyed 1,384 adults over the age of 18. Post-stratification weights were made on gender, age, race, education, and census region to reflect the population of these adults. based on five-year averages from the 2020 American Community Survey published by the US Census. The margin of error is 3.1%.