A new report by personal finance website Bankrate.com shows that two-thirds of Americans are reducing their monthly spending. One of the main reasons is, for many, incomes are stagnant.
The report shows that among respondents who are limiting their spending, about 32% say it is due to income stagnation. Roughly 29% say they are not spending as much because they need to save more. Those who expressed worry about the economy account for 16% of respondents.
Additional survey findings:
- Those between the ages of 30 and 49 are most likely to limit monthly spending.
- Millennials (those in the 18 to 35 age range) are most likely to see the need to save more as their main reason for reducing the amount spent each month.
“Sustainable growth in household income is the missing ingredient from this economic recovery and the leading culprit for why consumers are holding back on monthly spending,” said Bankrate.com’s chief financial analyst, Greg McBride, CFA, in a statement. “Worries about the economy have dissipated somewhat over the past year while consumers’ desire to forgo additional spending in order to save more has increased,” continues McBride.
Bankrate’s Financial Security Index shows that consumers’ comfort level with savings has declined over the last 12 months. In addition, compared to last month men are feeling less optimistic about their financial security, while women are more optimistic. Men cite improved financial security when compared to one year ago, and women continue to indicate a slight decline in financial security over the past year.