What You Need to Know
- A new survey finds that many Americans feel gloomy about their financial situations.
- Survey participants cited inflation as their top concern.
- It would be wise to plan for inflation and market volatility in the year ahead.
Looking ahead to the new year, many Americans are feeling downbeat about their personal financial situations, according to a new study from Allianz Life Insurance Co. of North America.
Twenty-nine percent of participants in the survey said their financial situation is worse now than it was a year ago, up from 19% in 2021. Respondents who said their financial situation is better than a year ago slightly decreased to 19% from 22%.
Fifty-three percent of those surveyed considered their financial picture the same as last year, down from 58% in 2021.
“This has been a tough year for Americans with inflation creating havoc with their finances,” Kelly LaVigne, vice president of consumer insights at Allianz Life, said in a statement. “These challenges aren’t going to go away when we flip the calendar, so it is best to make a plan for mitigating ongoing risks to financial stability like inflation and market volatility in the year ahead.”
Allianz Life conducted an online survey in November among a nationally representative sample of 1,000 respondents.
Inflation’s Toll
Last year, survey participants cited the pandemic as their top concern. This year, it’s inflation, which is at 40-year highs. Fifty-two percent of respondents said rising inflation is the first or second most worrisome threat in the next year, up from 38% in 2021.
Thirty-six percent pointed to price increases are the biggest threat to their retirement savings and retirement plans in the coming year, up from 25% who said this in 2021 and 8% in 2020. About half of Americans reported that their financial stress was about the same this year as it was in 2021, but 35% said they had experienced more stress during the past year, including 41% of Gen Xers, 36% of millennials and 27% of baby boomers.
Eighteen percent of respondents said that with a recession looming, they anticipate things getting worse in 2023, up from 12% last year who said this about 2022.