Nearly 2/3 of Americans Do Not Expect Personal Financial Situation to Improve in 2024
A new Bankrate survey found that 63 percent of Americans do not expect their personal financial situation to improve in 2024. More than a quarter (26 percent) believe their financial situation will get worse, with 16 percent of that share expecting their finances to get somewhat worse and 9 percent who expect them to get significantly worse. Alternatively, 37 percent believe their personal finances will improve, compared to 34 percent in 2022 and 33 percent in 2021.
“More than 6 in 10 Americans do not expect any improvement in their financial situation in 2024, and a staggering 61% point to continued high inflation as a culprit—nearly twice that of any other reason,” said Greg McBride, Bankrate Chief Financial Analyst. “Of the 37% of households expecting improved finances in the new year, higher income, better spending habits, and less debt are the most common explanations for the optimism.”
Other than inflation, commonly cited reasons Americans do not expect their personal finances to improve include stagnant or reduced income at 32 percent, work done by elected representatives at 31 percent, changing interest rates at 22 percent, the amount of outstanding debt at 19 percent, and the amount of money made from savings or investments at 16 percent.
Of the share that believe their financial situation will improve, 42 percent accredited rising income, followed by better spending habits at 38 percent, having less debt at 32 percent, and making more money from savings or investments at 27 percent.
Generationally, baby boomers are most likely to be pessimistic about their financial outlook for this year, while Gen Xers are more evenly split, and millennials and Gen Zers are more likely to believe their finances will improve.
Of the Americans who have a financial goal for this year, 22 percent said they are inclined to pay down debt, 16 percent want to get a higher paying job or another source of income, 15 percent want to save more for emergencies, and 13 percent hope to budget their spending better.
“Paying down debt has been the most commonly cited financial goal in each of the past 3 years,” said McBride. “But that goal does take on added urgency with rates on credit cards and home equity lines of credit at record highs, mortgage rates at more than two decade highs, and auto loan rates at the highest in more than 15 years.”