SURVEY: Middle-Income Americans Prepare for Possible Recession in 2023
Families look to decrease debt and become financially secure amid rocky economic outlook
During the fourth quarter of 2022, 81% of middle-income households reported they are bracing for a possible recession in 2023, with 62% either planning or already taking steps to prepare. Many middle-income families are aiming to rein in debt to become financially secure.
Overall, Americans are pessimistic about the current economy and the year ahead. Nearly three-in-four (72%) say their income is falling behind the cost of living, and just 15% believe that either their personal finances or the American economy will be better off a year from now.
“As middle-income families prepare for a possible recession this year, it’s more vital than ever that they take control of their personal finances by addressing debt, setting a budget and keeping spending in check,” said
“Three-quarters (74%) of middle-income families report not being able to save for their future, up from 66% a year ago,” said
Key Findings from Primerica’s
- Inflation continues to strain household finances. About three-quarters (76%) of families report they are continuing to cut back on non-essential purchases to cope with the high cost of living, and about half (51%) report having to tap into their emergency funds in the past year. In addition, about one-third report spending more money in the past year (33%) and/or dipping into their personal or retirement savings (36%).
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Confidence in personal finances, ability to save declines. While a majority (53%) still feel positive about their personal finances, that percentage has dropped 11 percentage points in the past year from 64%. In addition, just a quarter (24%) believe in their ability to save for the future, down 13 percentage points from
December 2021 . - Taking control of debt . Of those making financial New Year’s resolutions, the top two goals are paying off consumer debt (39%) and keeping debt load manageable (37%). In addition, about a quarter plan to create an emergency fund (25%) or stick to a budget (24%).
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Credit card use remains high. Middle-income families are increasingly relying on credit cards to keep up with the high cost of living. More than a third (36%) report using their credit cards more often in the past year, up 9 percentage points from
December 2021 . Additionally, more than a third (37%) say their credit card debt has increased in the past three months, up 8 percentage points fromDecember 2021 .
Topline Trends Data
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Dec.
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Sep.
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Jun.
|
Mar.
|
Dec.
|
Aug.
|
Apr.
|
How would you rate the condition of your personal finances? (Reporting “Excellent” and “Good” responses.)
Q4 2022 Survey: Respondents’ rating about the condition of their personal finances remained steady.
|
53% |
53% |
54% |
60% |
64% |
65% |
67% |
Overall, would you say your income is…? (Reporting “Falling behind the cost of living” responses.)
Q4 2022 Survey: Concern about meeting increased cost of living is down slightly.
|
72% |
75% |
75% |
67% |
68% |
65% |
56% |
Do you have an emergency fund that would cover an expense of
Q4 2022 Survey:
About the same percentage have an emergency fund that would cover an expense of
|
59% |
60% |
61% |
62% |
60% |
65% |
66% |
How would you rate the economic health of your community? (Reporting “Not so good” and “Poor” responses.)
Q4 2022 Survey: The economic health of communities is up slightly.
|
53% |
55% |
58% |
52% |
50% |
54% |
52% |
How would you rate your ability to save for the future? (Reporting “Not so good” and “Poor” responses.)
Q4 2022 Survey: Over 70% feel it will be difficult to save for the future, an increase from previous surveys.
|
74% |
73% |
72% |
66% |
62% |
63% |
58% |
In the past three months, has your credit card debt…? (Reporting “Increased” responses.)
Q4 2022 Survey: Credit card debt is at the highest point in Monitor history as it continues to increase quarter to quarter.
|
39% |
37% |
29% |
25% |
28% |
21% |
18% |
For more information on Primerica’s Middle-Income Financial Security Monitor, visit https://www.primerica.com/public/financial-security-monitor.html.
About Primerica’s Middle-Income Financial Security Monitor
The Monitor is a quarterly national survey to monitor the financial health of those with annual household incomes of
About
Primerica is a leading provider of financial services to middle-income households in
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Media:
gana.ahn@primerica.com
Investor Relations:
nicole.russell@primerica.com
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