SURVEY: Middle-Income Americans Prepare for Possible Recession in 2023
January 12 2023 - 12:00AM
Business Wire
Families look to decrease debt and become
financially secure amid rocky economic outlook
Primerica, Inc. (NYSE: PRI), a leading provider of financial
services in the United States and Canada, released its
Middle-Income Financial Security Monitor for the fourth quarter of
2022. The survey, in its third year, measures changes in the
sentiments of middle-income families in the U.S. about their
finances.
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 Glenn J. Williams, CEO of Primerica. “This
quarter’s Financial Security Monitor highlights the challenges
facing Americans in the year ahead and the need for personal
financial guidance to help lead the way through these rocky
economic times.”
“Three-quarters (74%) of middle-income families report not being
able to save for their future, up from 66% a year ago,” said Amy
Crews Cutts, PhD, an economic consultant to Primerica. “Inflation
over the past year, especially in non-discretionary items like food
and gasoline, has hurt the financial security of families as it was
impossible to avoid.”
Key Findings from Primerica’s U.S. Middle-Income Financial
Security Monitor
- 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%).
- 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%).
- 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
from December 2021.
Topline Trends Data
Dec. 2022
Sep. 2022
Jun.
2022
Mar. 2022
Dec.
2021
Aug.
2021
Apr.
2021
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 $1,000 or more (for
example, if your car broke down or you had a large medical bill)?
(Reporting “Yes” responses.)
Q4 2022
Survey: About the same percentage have
an emergency fund that would cover an expense of $1,000 or
more.
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
$30,000-$100,000. Change Research conducted online polling from
Dec. 7 - 12, 2022. Using Dynamic Online Sampling, Change Research
polled 1,263 adults nationwide with incomes between $30,000 and
$100,000. Post-stratification weights were made on gender, age,
race, education and Census region to reflect the population of
these adults based on the five year averages in the 2019 American
Community Survey, published by the U.S. Census. The margin of error
is 3.0%.
About Primerica, Inc.
Primerica is a leading provider of financial services to
middle-income households in the United States and Canada. Licensed
financial representatives educate Primerica clients about how to
prepare for a more secure financial future by assessing their needs
and providing appropriate products like term life insurance, mutual
funds, annuities, and other financial products. Primerica, through
its subsidiaries, insured over 5.7 million lives and had over 2.7
million client investment accounts as of December 31, 2021.
Primerica was the #2 issuer of Term Life insurance coverage in the
United States and Canada in 2021 through its insurance company
subsidiaries. Primerica stock is included in the S&P MidCap 400
and the Russell 1000 stock indices and is traded on The New York
Stock Exchange under the symbol “PRI”.
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version on businesswire.com: https://www.businesswire.com/news/home/20230111005755/en/
Media: Gana Ahn, 678-431-9266 gana.ahn@primerica.com
Investor Relations: Nicole Russell, 470-564-6663
nicole.russell@primerica.com
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