- Nearly half of investors say rising inflation is causing them
stress and anxiety.
- Majority are changing their spending behavior, cutting back on
discretionary expenses including dining out and entertainment.
- One-in-four investors (25%) cancelled a vacation planned for
the year ahead due to rising inflation.
- Majority of investors believe the US economy is headed for a
recession in the next 6-12 months.
- Generation X is significantly more concerned than Millennials
and Boomers about the economic outlook, maintaining their current
standard of living, retiring on time and affording expenses in
retirement.
- Less than half of investors are confident they will reach their
financial goals due to rising inflation.
State Street Global Advisors, the asset management business of
State Street Corporation (NYSE: STT), today announced the findings
of its Inflation Impact Survey, which reveals how inflation is
influencing Americans’ spending, saving, and investing behavior.
The survey found that with inflation on the rise, over two-thirds
of investors (67%) are concerned about our country’s economic
outlook over the next 12 months, with over half also expressing
concern over market volatility (57%) and the value of their current
investments eroding (59%). Notably, Generation X is significantly
more concerned than Millennials or Boomers about the effects that
inflation, the stock market and economy could have on their
personal financial situation.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20220808005847/en/
49% of investors do not think inflation
has peaked according to State Street Global Advisors' Inflation
Impact Survey. (Graphic: Business Wire)
In the past 12 months, rising inflation has caused the greatest
proportion of investors (51%), to curtail discretionary spending
such as dining out and entertainment. Just over a third spent less
on vacations or delayed a major purchase (35%), and 29% have cut
back on essential expenses like groceries and gasoline.
“As Americans work to defend themselves against the corrosive
effect of inflation on their finances, we’re encouraged to see the
majority are making tradeoffs in discretionary spending, rather
than sacrificing contributions to their long-term savings goals,”
said Brie Williams, head of Practice Management at State Street
Global Advisors. “Notably, less than one-quarter of Americans were
willing to curtail contributions to their retirement savings or
their child’s education savings, which demonstrates a firm
commitment to their long-term financial goals.”
Has Inflation Peaked Yet?
With so many already tightening their belts, it is no surprise
that 58% of investors agree that the US economy is headed for a
recession in the next six to 12 months, with 47% agreeing with the
statement: “Inflation is causing me stress/anxiety.”
Furthermore, they don’t believe the worst is over. Less than
two-in-ten investors (17%) believe inflation has already seen its
peak. That’s in sharp contrast to the 49% who do not think
inflation has peaked.
Millennials and Inflation: Glass Half-Full?
Millennials are significantly more optimistic that inflation has
already topped out than Gen X and Boomers; 43% of Millennials
believe inflation has peaked, compared to just 5% of Gen X-ers and
Boomers.
Record high inflation isn’t dampening Millennials’ optimism that
they’ll reach their financial goals, either; 63% of Millennials are
confident they can reach their financial goals, while overall, the
majority of investors believe inflation is an obstacle. Less than
half of Gen X-ers (32%) and Boomers (40%) are confident they’ll
reach their financial goals due to rising inflation.
Sandwich Generation Shows Signs of Distress
In June 2021, concern about rising inflation was similar across
generations, however, in June 2022, significantly more Gen X-ers
(88%) indicated concern compared to Millennials (72%) and Boomers
(70%).
When it comes to the overall economic outlook for our country in
the next 12 months, 76% of Gen X-ers are concerned, compared to 60%
of Millennials and 65% of Boomers.
The outlook for their personal financial situation wasn’t much
better: 56% of Gen X-ers are worried about maintaining their
current standard of living, compared to 46% of Millennials and 43%
of Boomers.
Being able to afford to retire when planned is another worry
with 59% of Gen X expressing concern over this, compared to 41% of
Millennials and 31% of Boomers. Being able to afford expenses in
retirement was also a bigger worry for Gen X, with 56% expressing
concern, versus 41% of Millennials and 44% of Boomers.
Generation X Takes Action Against Inflation
Examination of the money moves each generation has made in the
last 12 months reveals significantly more members of Generation X
have cut back on spending compared to Millennials and Boomers.
A greater percentage of Gen X-ers than Millennials and Boomers
have seen their finances derailed by inflation and have had to cut
back on discretionary spending like dining out or entertainment
(61%) and essential purchases like groceries or gasoline (41%), or
delayed a major purchase like a vehicle or home appliance
(39%).
“These are challenging times for many Americans. About half of
all investors believe that the lessons learned by navigating the
current inflationary environment will have a lasting impact on
their spending and saving habits moving forward,” Williams noted.
“Making prudent financial decisions during times of uncertainty
could make committing to a budget or investment discipline easier
when the economy improves. For those looking for help managing
through the uncertainty, now is the time to talk to a financial
advisor to make sure they’re on track to meet their financial
goals.”
For more on SPDR’s point of view on the market, economy and
inflation read our 2022 Mid-Year Outlook and 5 Burning Questions
Give Investors Insight: Durable Rebound or More Pain to Come?
Click here for the latest Bond Compass, SPDR’s quarterly outlook
on fixed-income.
For more on State Street’s outlook on the global markets and
economy click here.
For more resources on ETF basics visit our ETF education landing
page.
To learn more about how investors are using low-cost ETFs to
achieve a variety of investment objectives, read Build a Low-Cost
Core Portfolio with SPDR ETFs.
About State Street Global Advisors’ Inflation Impact
Survey
State Street Global Advisors, in partnership with A2Bplanning
and our field partner, Prodege, conducted an online survey among a
nationally representative sample of adults. Data was collected from
June 28 – July 5, 2022. For our Custom “Inflation Impact Survey,”
we analyzed 243 adults with Investable Assets (IA) of $250K or
more.
About SPDR Exchange Traded Funds
SPDR ETFs are a comprehensive family spanning an array of
international and domestic asset classes. The funds provide
investors with the flexibility to select investments that are
aligned to their investment strategy. For more information, visit
www.ssga.com.
About State Street Global Advisors
For four decades, State Street Global Advisors has served the
world’s governments, institutions and financial advisors. With a
rigorous, risk-aware approach built on research, analysis and
market-tested experience, we build from a breadth of index and
active strategies to create cost-effective solutions. As stewards,
we help portfolio companies see that what is fair for people and
sustainable for the planet can deliver long-term performance. And,
as pioneers in index, ETF, and ESG investing, we are always
inventing new ways to invest. As a result, we have become the
world’s fourth-largest asset manager* with US $3.48 trillion† under
our care.
*Pensions & Investments Research Center, as of 12/31/21.
†This figure is presented as June 30, 2022 and includes
approximately $66.43 billion of assets with respect to SPDR
products for which State Street Global Advisors Funds Distributors,
LLC (SSGA FD) acts solely as the marketing agent. SSGA FD and State
Street Global Advisors are affiliated.
Important Risk Disclosures
The information provided does not constitute investment advice
and it should not be relied on as such. It should not be considered
a solicitation to buy or an offer to sell a security. It does not
take into account any investor's particular investment objectives,
strategies, tax status or investment horizon.
The whole or any part of this work may not be reproduced, copied
or transmitted or any of its contents disclosed to third parties
without SSGA’s express written consent.
Investing involves risk, including the risk of loss of
principal.
This communication is not intended to be an investment
recommendation or investment advice and should not be relied upon
as such.
ETFs trade like stocks, are subject to investment risk,
fluctuate in market value and may trade at prices above or below
the ETFs net asset value. Brokerage commissions and ETF expenses
will reduce returns.
While the shares of ETFs are tradable on secondary markets, they
may not readily trade in all market conditions and may trade at
significant discounts in periods of market stress.
Equity securities may fluctuate in value and can decline
significantly in response to the activities of individual companies
and general market and economic conditions.
Frequent trading of ETFs could significantly increase
commissions and other costs such that they may offset any savings
from low fees or costs.
Bond funds contain interest rate risk (as interest rates rise
bond prices usually fall). There are additional risks for funds
that invest in mortgage-backed and asset-backed securities
including the risk of issuer default; credit risk and inflation
risk.
Non-diversified funds that focus on a relatively small number of
securities tend to be more volatile than diversified funds and the
market as a whole.
Passively managed funds hold a range of securities that, in the
aggregate, approximates the full Index in terms of key risk factors
and other characteristics. This may cause the fund to experience
tracking errors relative to performance of the index.
Actively managed funds do not seek to replicate the performance
of a specified index. The fund is actively managed and may
underperform its benchmarks. An investment in the Fund is not
appropriate for all investors and is not intended to be a complete
investment program. Investing in the Fund involves risks, including
the risk that investors may receive little or no return on the
investment or that investors may lose part or even all of the
investment.
Standard & Poor’s®, S&P® and SPDR® are registered
trademarks of Standard & Poor’s Financial Services LLC
(S&P); Dow Jones is a registered trademark of Dow Jones
Trademark Holdings LLC (Dow Jones); and these trademarks have been
licensed for use by S&P Dow Jones Indices LLC (SPDJI) and
sublicensed for certain purposes by State Street Corporation. State
Street Corporation’s financial products are not sponsored,
endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their
respective affiliates and third-party licensors and none of such
parties make any representation regarding the advisability of
investing in such product(s) nor do they have any liability in
relation thereto, including for any errors, omissions, or
interruptions of any index.
Distributor: State Street Global Advisors Funds
Distributors, LLC, member FINRA, SIPC, an indirect wholly owned
subsidiary of State Street Corporation. References to State Street
may include State Street Corporation and its affiliates. Certain
State Street affiliates provide services and receive fees from the
SPDR ETFs.
Before investing, consider the funds’ investment objectives,
risks, charges and expenses. To obtain a prospectus or summary
prospectus which contains this and other information, call
1-866-787-2257 or visit ssga.com. Read it carefully.
Not FDIC Insured · No Bank Guarantee · May Lose Value
State Street Global Advisors, 1 Iron Street, Boston, MA
02210-1641.
© 2022 State Street Corporation.
All Rights Reserved.
4860949.1.1.AM.RTL Exp. Date: 05/31/2023
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220808005847/en/
Deborah Heindel +1 617 662 9927 DHEINDEL@StateStreet.com
State Street (NYSE:STT)
Historical Stock Chart
From Jul 2024 to Aug 2024
State Street (NYSE:STT)
Historical Stock Chart
From Aug 2023 to Aug 2024