Bankrate’s latest Financial Security Index offers up good news
There are many studies that look into how Americans spend money, but agents should take note of a new Bankrate Financial Security Index, which measures American consumers’ confidence in the market, their net worth, savings and employment status compared to a year ago.
We’ve taken a look at the four most important details from the survey.
1. American Confidence in Financial Situations – Thanks to feelings of job security, manageable debt and rising net worth for many Americans, Bankrate’s Financial Security Index reached one of its highest marks in the past nine months. While 52 percent of people viewed their current financial state as similar to last year, 30 percent said their situation was better than a year ago; only 16 percent said it was worse than last year. Likewise, net worth was largely regarded as higher or similar to last year, with 51 percent of people saying their net worth was similar to last year, while 30 percent said it was higher (only 17 percent said it was lower).
2. Millennials Set to Meet Challenges – One of the most interesting facts was the confidence of Millennials. Only 8 percent said their financial situation was worse compared to a year ago, and just 3 percent said their net worth was lower this year compared to last. Additionally, despite previous concerns about student loan debt and low wages, Millennials are still managing to find money to put into savings – 49 percent are saving up to 10 percent of their income, and 28 percent are saving up to 5 percent. In the face of financial adversity, Millennials are not only overcoming the challenges, but excelling, which bodes well for their future homeownership prospects.
3. Low-Wage Earners Saving More – Millennials aren’t the only ones who have learned lessons from the financial downturn. Low-wage earners are saving more, with 27 percent of Americans with an annual income between $30,000 to $50,000 saving more than 10 percent of their income. Again, this is proving to be a positive trend, considering previous fears over high prices and rent stifling potential first-time homebuyers.
4. Americans’ Savings Struggle Ongoing, but Improving – Last October, GoBankingRates found that 62 percent of Americans had little to no money in their savings account, a worrying finding. Bankrate noted that 21 percent of employed Americans are still not saving anything. This trend is most prominent amongst those aged between 30 and 49, but all age groups surveyed suffered– those sampled stated they had no savings for homes, retirement or emergencies. While significant improvement in the amount Americans are saving is reflected in the new Bankrate index, there are still too many people not saving as a whole.