Despite a Difficult Year, Consumers Are Financially Optimistic, See Improvements in Spending, Saving

Rhea-AI Summary

The Chase Financial Health Consumer Study revealed that nearly half of U.S. consumers expect improved financial conditions in the coming year. Approximately 33% noted enhanced spending habits and savings, with Black (54%) and Latinx (49%) individuals showing increased optimism. The survey, conducted with Morning Consult, highlighted that 37% of respondents reported financial deterioration over the past year, while 65% feel in good financial health. Key goals include budgeting and saving, yet only 76% felt confident in their ability to save effectively.

Positive

• 48% of consumers are optimistic about their financial future.
• 65% of respondents claim they are in good financial health.
• 51% of consumers are focused on improving their savings.

Negative

• 37% of respondents reported worsening financial situations.
• 16% experienced job loss or income reduction in the last year.
• 20% reported having less disposable income.

Nearly half of U.S. consumers think that their finances will be better off in the next year, as nearly a third saw improvements in their spending habits and savings, according to a new survey from Chase. Optimism is slightly higher among Black (54%) and Latinx (49%) respondents as many have taken action to improve their credit, spending, or earn a second income.

The new Chase Financial Health Consumer Study—conducted in partnership with Morning Consult—surveyed more than 5,000 U.S. consumers on the state of their finances, attitudes towards saving and budgeting, and actions they’ve taken to improve their financial health. The survey polled consumers across all demographics and took a closer look at the financial goals and impacts among Black and Latinx consumers – populations hardest hit by the economic impact of the pandemic.

“These findings underscore the challenges from loss of jobs and income and the impact the pandemic has had on consumer finances, but also puts into focus how Americans are thinking about money in the future,” said Lawrence Bailey, Head of Community & Business Development at Chase. “Small steps matter. From saving a little more each month to monitoring your credit score – these steps help consumers prepare for the unexpected, while also setting them up for success in the long run.”

Unsurprisingly, the pandemic has had a significant impact on consumers’ finances, as many experienced a loss of income or a financial fluctuation over the last year.

• 37% of the general population said that their financial situation has gotten worse over the last year, with 16% reporting a job loss, furlough or loss of income over the last 12 months.
• 20% said that they had less disposable income, which is consistent among Black (23%) and Latinx (25%) respondents.

Still, consumers feel more optimistic about their financial future and are taking actionable steps to improve their financial health.

• 65% of the general population believe they are currently in good financial health.
• Black (54%) and Latinx (49%) respondents are more optimistic about their finances this year, slightly higher than the general population at 48%.
• 51% of the general population are focusing on improving their savings, 39% on eliminating debt.
• 24% of Black and Latinx respondents said that they’ve taken action to improve their credit, compared to 19% of the general population.

• Black (21%) and Latinx (19%) respondents started a new business or side hustle in the last year, compared to 11% of the general population.

More than half of consumers used or plan to use their stimulus checks to pay essential bills

• 53% of the general population used funds to pay bills, like utilities, credit card or their phone
• 36% put money toward savings
• 30% paid down debt
• 22% paid rent or mortgage
• 10% put money toward a ‘nice to have’, like entertainment
• 7% donated to a cause

Paying bills on time, budgeting are top financial goals this year

Survey respondents all agreed that their top financial goals in the past year included paying bills, like utilities, as well as their mortgage in full and consistently each month. Additionally:

• 32% of the general population indicate developing or maintaining a budget that works for them as a primary goal.
• Black (20%) and Latinx (22%) respondents listed getting their finances in order to purchase a home as a financial goal, compared with 14% of the general population.
• Black (16%) and Latinx (14%) respondents plan to start a business this year, compared to 9% of the general population.

The majority of consumers think it’s important to save, but fewer are confident in their ability to do so

• While 83% of the general population agree it’s important to budget for long-term finances and emergency savings each month, fewer (76%) are confident in their ability to do so, and 62% felt confident in their ability to set aside money for retirement.
• Income is the biggest driver in the availability of emergency funds. Black (34%) and Latinx (36%) respondents indicate they don’t have enough money to support them if they become unable to work.
• While many Baby Boomers are at or near retirement age, fewer than half (48%) have enough financial resources to support them if suddenly unable to work for more than four months.

Consumers equally value in-person advice, digital tools when looking to improve financial health

• 34% of the general population prefer a digital tool that helps them budget or automatically save, consistent with a third who prefer expert advice or interaction with a banker.

Chase offers a variety of tools and resources to help consumers grow their savings, manage a budget and build their credit. To learn more, customers can visit Chase’s new financial goals website at: https://www.chase.com/personal/financial-goals.

About Chase

Chase is the U.S. consumer and commercial banking business of JPMorgan Chase & Co. (NYSE: JPM), a leading global financial services firm with assets of $3.7 trillion and operations worldwide. Chase serves more than 60 million American households with a broad range of financial services, including personal banking, credit cards, mortgages, auto financing, investment advice, small business loans and payment processing. Customers can choose how and where they want to bank: More than 4,700 branches in 38 states and the District of Columbia, 16,000 ATMs, mobile, online and by phone. For more information, go to chase.com.

Research Appendix

• Latinx respondents were twice as likely than the average American to identify childcare expenses as a financial stressor
• 5-out-of-10 of Black respondents said that paying bills in full and consistently each month (such as utilities, cable or phone bills, credit card bills) was their #1 financial goal
• Two-thirds of the general population think it is important to learn their credit score; 54% think it’s important to automate credit card payments, bills, or other payments
• Top three financial stressors for the general population and Latinx respondents included:
  • Unexpected expenses following an emergency
  • Home maintenance
  • Taxes
• Top three financial stressors for Black respondents included:
  • Unexpected expenses following an emergency
  • Repairing a current car
  • Buying a new car
• Across all audiences, the top three positive financial habits to occur in the past year included:
  • Improved spending habits
  • Improved savings
  • Taken action to improve credit
• 40% of students say their finances got better and 29% said their finances got worse
• 30% of students experienced financial stress due to tuition
• 3-in-10 Adults feel worried about their finances
• Income is the biggest driver in availability of emergency funds
• While many Baby Boomers are at or near retirement age, only 48% have enough financial resources to support them if suddenly unable to work for 4+ months

This study is based on a Chase survey conducted by Morning Consult sampling more than 5,000 consumers in the United States between February 12-26, 2021. The interviews were conducted online in the respondent's choice of English or Spanish and the data were weighted to approximate a target sample of consumers based on age, race, gender, and educational attainment. The survey includes an oversample of Black and Latinx consumers.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210429005653/en/

FAQ

How many U.S. consumers expect their finances to improve in the next year?

Nearly 50% of U.S. consumers believe their finances will improve over the next year.

What percentage of respondents experienced a job loss in the last year?

16% of respondents reported a job loss, furlough, or loss of income in the past year.

What are the top financial goals for consumers this year according to the survey?

Top financial goals include paying bills on time, budgeting effectively, and improving savings.

What percentage of Black and Latinx respondents took action to improve their credit?

24% of Black and Latinx respondents have taken action to improve their credit.

How did consumers use their stimulus checks according to the Chase survey?

53% used their stimulus checks to pay bills, 36% saved, and 30% paid down debt.