Middle-Class Americans Overestimate Their Financial Security: Survey

Middle-class Americans’ own assessment of financial security suggests they may be too optimistic, according to a new survey.

The new pulse survey from CUNA Mutual Group, a leading provider of lending, insurance, investment and financial technology solutions for credit unions, reveals a disconnect between middle-class aspirations and resources.

“Middle class” was defined as an annual income of $35,000 to $100,000.

The survey finds that Americans in this income group tend to feel positive about their prospects for upward mobility. For example, when asked to grade the ability of the middle class to achieve the American Dream, the average response was B-minus.

In addition, respondents’ assessment of their own financial security shows quite a bit of confidence. According to the survey, 62% say they feel somewhat or very confident about their personal financial situation, and nearly half (46%) believe it is very unlikely that they will miss a loan payment over the next one to two years.

However, the survey finds that this cautious optimism belies a more troubling financial picture. More than half of respondents are ill-equipped for an emergency, with 23% saying they have no emergency savings and 30% saying they only have one to three months’ worth.

“The middle class continues to experience stress from the long-term impacts of the 2008 recession,” said Steve Rick, chief economist at CUNA Mutual Group. “Markets may be rebounding and unemployment at historic lows, but we’re still seeing middle-class families struggle with sticky wages, inadequate liquidity, high debt, insufficient savings and difficulty building wealth. This population is among the most exposed to an eventual downturn.”