Americans are feeling less financially secure now compared to the end of last year, according to a recent poll. They are adjusting their spending habits to adapt to changes in the US economic environment. Half of Americans are taking steps to cut back on monthly bills and are dining out less often to save more money, per the survey. Consumers are cutting spending due to economic uncertainty in a number of ways.
Americans are feeling less financially secure now compared to the end of last year, according to a recent poll.
The sense of financial security in the US continues on a downward trend, with the share of those rating their financial security as ‘good’ or ‘excellent’ falling 5% since late 2022, and 7% from the end of 2021, according to a new Country Financial Security Index report that surveyed over a thousand adults in the US over three days in early May.
So how are they curing back?
Reducing discretionary spending. This includes things like eating out, going to the movies, and shopping for new clothes.
- Shopping around for better deals. Consumers are becoming more price-conscious and are willing to shop around for the best deals on everything from groceries to electronics.
- Using coupons and discounts. Consumers are also taking advantage of coupons and discounts to save money on their purchases.
- Delaying or cancelling non-essential purchases. Consumers are putting off or cancelling non-essential purchases, such as home renovations or new cars.
- Digging into savings. Some consumers are dipping into their savings to cover unexpected expenses or to make ends meet.
- Taking on debt. Others are taking on debt, such as credit card debt or personal loans, to cover their expenses.
These are just a few of the ways that consumers are cutting spending due to economic uncertainty. As the economy continues to struggle, it is likely that consumers will continue to tighten their belts and cut back on their spending.
Here are some additional details about how consumers are cutting spending:
- A recent survey by Bankrate found that 69% of Americans are planning to cut back on their spending in the next few months. The top areas where consumers plan to cut back are dining out, entertainment, and travel.
- Another survey by the Conference Board found that consumer confidence has fallen to its lowest level in 10 years. This decline in confidence is likely due to a number of factors, including the rising cost of living, the war in Ukraine, and the ongoing COVID-19 pandemic.
- The Federal Reserve is expected to raise interest rates several times this year in an effort to combat inflation. This is likely to lead to higher borrowing costs for consumers, which could further dampen spending.
Overall, it is clear that consumers are becoming more cautious with their spending as the economy faces a number of challenges. This trend is likely to continue in the months ahead.