According to the latest research by Mintel on consumers’ attitudes about the economy, folks in the US are not looking at the future through rose-colored glasses. 72% of US consumers think younger generations will have a more difficult time than they had, and 49% think that other countries offer better opportunities than the U.S..
The research shows that it’s not just younger generations who have had a hard time in the current economic climate, says the report. It is actually younger Baby Boomers, those aged 45-54 and at the peak of their earning years, who are the least likely to say that their finances are healthy. 41% of this group indicate that their household financial situation is “tight,” “struggling” or “just getting by” five years after the recession, compared to 37% of Gen X (35-44 year olds) and 33% of consumers overall.
Susan Menke, VP, financial services at Mintel, said that “...the fact that younger Boomers are struggling with their household finances is bad news for economic growth... this age group... is usually at the peak of their earning power... has traditionally been a primary driver of consumer spending and therefore of the economy... these younger Boomers will likely delay retirement for financial reasons, which will impact the already difficult job prospects for Millennials and Gen Xers... ”
When it comes to financial goals, says the report, consumers in the US are strongly focused on saving money for a rainy day and achieving or maintaining good credit. 76% feel that having good credit is key to economic success and 87% of Americans are prioritizing paying their bills on time. In addition, consumers are prioritizing short term savings over saving for the long term, an indication that they do not feel they have enough saved for contingencies. 81% are focusing on saving for emergencies or unexpected events, while 72% would like to add to, or increase the amount saved for retirement.
Menke explains that “... most consumers are living paycheck to paycheck and do not have nearly enough in their savings accounts to feel they are prepared for unexpected events... or... maintain their current lifestyles in retirement... consumers have refocused their financial priorities... It is probable that the recession has created a new kind of consumer... more conservative and has a renewed focus on achieving financial security by different means... “
The research also shows that higher incomes aren’t necessarily experiencing a greater degree of financial security than other income groups, says the report. 10% of those with $150K+ in household income say they are struggling or just getting by, as are 16% of households with income of $100K-149.9K.These income groups are experiencing some wage stagnation as well, with 47% of those earning $150K+ expecting their salaries to remain the same over the coming year. Other household income groups have the same expectations: 57% of US consumers overall are expecting a continuation of the status quo for their income in 2013, and 50% think the same about the total amount in their savings accounts.
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