"Recession" surrounded by storm clouds (Photo by D koi on Unsplash)
NEW YORK — Despite a financially challenging year, many Americans feel resilient when it comes to their finances — specifically, young Americans. More than three in four (76%) feel prepared for a recession. However, the survey of 2,000 U.S. adults found that more millennials (79%) feel prepared for an economic downturn than baby boomers (60%).
Nearly seven in 10 (69%) people have a clear plan to manage their finances for the remainder of 2023. Additionally, about two in three (64%) say that they feel in control of their finances. They have been maintaining that sense of control by budgeting (69%), building an emergency fund (68%), paying off debt (64%), and tracking their spending (53%).
Commissioned by Affirm and conducted by OnePoll, research revealed this financial confidence may be due to the changes people made in the first half of 2023. Fifty-five percent of Americans changed their approach to their finances this spring, with 63 percent doing so specifically to prepare for a recession.
They did this by saving more (68%) and spending less (65%), creating a budget (54%), talking to a financial adviser (50%), and downloading financial or budgeting apps (43%).
“Despite having financial confidence, Americans still want to do more. In fact, about 80 percent think they could be doing a better job managing their finances,” says Chief Revenue Officer at Affirm, Wayne Pommen, in a statement. “While about 70 percent of people have created or are using a personal budget, the average person has spent about $350 over budget in the past six months.”
More than half of people (51%) think about their finances three or four times a day – nearly as much as they think about their romantic relationships (54%). Among those who admitted they don’t save as much as they think they should, 55 percent pointed to increased cost of living as the most significant barrier to saving.
For half of Americans (50%), the most stressful aspect of their financial lives is their bank account balance. Budgeting for big purchases (44%), everyday expenses (43%), and bills (40%) followed close behind. One-quarter (25%) found late fees on a credit card as the biggest stress.
“About three in four agreed that credit cards make it challenging for them to manage their spending,” adds Pommen. “On the other hand, nearly half (48%) said ‘buy now, pay later’ is the payment method that makes them feel most in control of their finances, more than spending with a credit card (41%) or cash (28%). Pay-over-time options let you choose the payment schedule that works best for you and helps you gain control over your spending. Be sure to always look for options that don’t charge late or hidden fees that can throw a wrench in your budget.”
Survey methodology:
This random double-opt-in survey of 2,000 general population Americans was commissioned by Affirm between June 20 and June 23, 2023. It was conducted by market research company OnePoll, whose team members are members of the Market Research Society and have corporate membership to the American Association for Public Opinion Research (AAPOR) and the European Society for Opinion and Marketing Research (ESOMAR).
