TLDR:
A recent survey conducted by Edward Jones found that 80% of Americans made at least one financial New Year’s resolution for 2024. The top financial objective cited by respondents was increasing income, followed by building savings and paying off credit card debt. However, 61% of Americans said that lingering high inflation could pose a challenge to achieving their financial goals. Despite this, moderating inflation has helped increase the spending power of middle-income households in the US. The survey also revealed that Americans are dealing with a record amount of credit card debt. To stay on the right financial foot in 2024, experts recommend budgeting carefully, setting up an emergency fund, and pursuing additional sources of income.
Key Elements:
- 80% of Americans made at least one financial New Year’s resolution for 2024.
- The top financial objective for 2024 is increasing income, followed by building savings and paying off credit card debt.
- 61% of Americans believe high inflation could hinder their financial goals.
- Moderating inflation has increased the spending power of middle-income households.
- Americans owe a record amount of credit card debt.
- To stay on track in 2024, experts recommend budgeting carefully, setting up an emergency fund, and pursuing additional income sources.
Article:
A recent survey conducted by Edward Jones found that 80% of Americans made at least one financial New Year’s resolution for 2024. The survey results indicate that Americans are feeling more optimistic about their finances after weathering inflation and rising prices, which has pushed them to set financial goals for the year ahead.
The top financial objective cited by respondents was increasing income, with 17% of participants choosing this as their primary focus. Building savings came in second place, with 16% of respondents prioritizing this goal. Additionally, 15% of participants said they planned to pay off credit card debt in 2024.
However, despite the optimism, 61% of Americans also expressed concerns about high inflation and its potential impact on achieving their financial goals. While the latest figures show that inflation is moderating, there is still uncertainty as to when it will reach the 2% target rate set by the Federal Reserve. This concern about inflation is in addition to worries about unexpected financial strains and economic market changes, which were cited by 35% of respondents as potential obstacles to their financial resolutions for 2024.
Moderating inflation has had a positive effect on the spending power of middle-income households in the US. According to Primerica’s Household Budget Index (HBI), which measures the purchasing power of middle-income households with incomes between $30,000 and $130,000, the index reached 100.5% in November 2023, up from 99.1% the previous month. The increased spending power is attributed to a significant dip in gasoline prices and a slight decrease in food prices, as well as continued strength in household incomes. However, the report also highlights that these households have operated under an average cumulative budget deficit of nearly $2,500 due to increased costs of necessity items since 2021.
In addition to inflation and budget deficits, Americans are also grappling with record levels of credit card debt. Recent data from the Federal Reserve Bank of New York shows that Americans now owe $1.08 trillion in credit card debt, with $48 billion added in the third quarter of 2023.
To stay on the right financial foot in 2024, experts recommend several steps. Firstly, budgeting carefully is crucial to understanding one’s financial situation and identifying areas where expenses can be reduced or eliminated in order to pay down debt or save more. Secondly, building an emergency fund is advised, with experts suggesting saving a small amount of money each month until there is enough to cover three to six months’ worth of expenses. This fund can act as a safety net against unexpected financial strains. Lastly, pursuing additional sources of income, such as through side gigs, part-time work, or freelancing opportunities, can help boost income and improve financial stability.
In summary, the survey indicates that Americans are feeling more confident about their finances in 2024 and have set financial goals as a result. However, concerns about inflation and other economic factors remain. To stay on track, experts recommend budgeting carefully, building an emergency fund, and seeking additional income sources to improve financial stability.
