LendingTree®, Charlotte, said Wednesday that a recently conducted online survey among 1,025 Americans found two out of three Americans have an optimistic outlook for the year ahead, with millennials being even more optimistic.
According to the survey, almost half of Americans (45%) feel that 2017 was at least somewhat better than 2016 in terms of personal finances. Approximately one third (34%) earned more in 2017 than they did in 2016, 24% put more into savings in 2017 compared to 2016, and 21% improved their score over the past 12 months. However, only 16% reduced their total credit card debt, making debt reduction a priority in the year ahead.
The survey found Americans generally have an optimistic outlook for 2018, with 67% expecting personal finances to improve over the next 12 months. Fewer than 10% of respondents said they expected their finances to worsen in the year ahead. Today’s economic indicators could be contributing to the positive outlook, with jobless rates at a 17-year low, home prices steadily climbing in most markets and stocks continuing to rally.
Millennials (aged 35 and under) were the most optimistic demographic. A full 79% expect their finances to improve this year. In contrast, only 55% of those older than 50 said they expect their finances to improve. There weren’t many differences in optimism between the sexes: men were only slightly more pessimistic about their financial prospects than women.
Additional positive expectations for 2018 include:
- 46% expect income to increase
- 28% expect to pay off credit card debt
- 35% plan to make and/or stick to a budget in 2018
- 35% also expect to improve their credit score
- 18% expect to save for a down payment on a house
- 27% plan to build an emergency fund
- 26% expect to save for a savings/purchase goal
The survey found that many people are planning on making some changes that may affect personal finances in 2018. Twenty-seven% of respondents expect to purchase a new car in 2018. This was followed by 23% who plan to move or relocate sometime this year, 20% who expect to switch jobs and 13% who believe they’ll become homeowners in 2018.
A sunny outlook for 2018 finances doesn’t come without at least some financial concerns. Americans feel most uneasy about unexpected expenses (43%), followed by their ability to make ends meet (34%), which may be why 27% are hoping to build an emergency fund and 26% are hoping to put more into savings in 2018. Healthcare costs come in third place with 29%, although healthcare expenses ranked second (40%) for those over age 50.
The 35-and-under crowd echo the financial concerns of other generations, with 39% of millennials stressing about unexpected expenses and 30% worrying about their ability to make ends meet.
When asked about what they thought would happen to house prices and rental where they currently live, more respondents expect home prices to rise, as opposed to remaining level or falling. The%ages were similar no matter the respondents’ age or gender. Only 10% of respondents expect home prices to fall.
Separately, when asked what they were most optimistic about in 2018, only 8% of respondents said they were optimistic about home prices rising. But another 5% – prospective home buyers, perhaps — said they were looking forward to home prices falling.
Debt reduction is a priority for many Americans, with 36% of survey respondents saying they’d use a $10,000unexpected windfall to pay down debt. For contrast, 14% would invest the money, 13% would spend the money on family and 10% would use those funds for home improvement projects.
Despite some uncertainty about the specifics, Americans expressed that paying off debt was the financial matter they were most confident about accomplishing in 2018, outpacing that of controlling spending and increasing income. Thirty-one% said they were confident they would pay off debt this upcoming year, followed by 27% who were confident they would reign in unnecessary spending and 19% who felt confident about receiving a raise. Most people chose the financial concerns they have the most control over (like controlling spending and paying down debt) than more economic matters that were largely out of their control (like home prices and financial market performances).
Debt consolidation on the mind of many, but methods unclear
When asked if they thought they might consolidate the debts this year, 13% of Americans were considering debt consolidation.
But when those 13% were asked if they knew where they would obtain the financing for the debt consolidation, most respondents didn’t know. Only 40% of those looking to consolidate their debt knew where they would go to accomplish that task (the most popular choice was going to a bank or credit union).
To view the rest of the survey results, visit https://www.lendingtree.com/finance/resolutions-and-goals-2018/
