With inflation reaching historic highs and no immediate relief to the financial pain in sight, American consumers have abruptly changed their spending and saving habits, according to a pair of newly published data surveys.
On The Spending Front: According to a nationwide survey from Provident Bank, an Iselin, New Jersey-based subsidiary of Provident Financial Services Inc. PFS:
- 10.5% of respondents acknowledging they eliminated all non-essential purchases.
- More than 71.67% say they have made at least some changes to personal travel habits.
- In terms of product purchases, 53.3% of respondents said they now spend between $101 and $500 more per month on groceries.
- 32% of drivers are now spending between $101 and $250 more per month on gasoline.
- 13.5% reporting a monthly increase in fuel costs between $251 and $500.
To save money, many of the respondents are concentrating their shopping trips at discount stores, switching to generic or store brand items and cutting meat from their diets. They’ve also cut back on eating out and buying coffee at cafes, and there has also been an uptick in consumer who are quitting smoking due to increased costs of tobacco products.
When it comes to traveling, most consumers are either postponing — or avoiding — trips to expensive areas until gasoline prices go down. Some are even mapping out their gasoline usage before they hit the road while others are wielding Zoom ZM and other virtual platforms rather than making in-person visits.
“As bankers, it’s important that we uncover these financial pain points for consumers as it relates to inflation,” said Provident Bank president and CEO Anthony Labozzetta. “Similar to the pandemic, it’s a time for financial institutions to step up and work with their customers on how best to help them navigate through these challenging times.”
On The Savings Front: In a separate survey, FICO FICO found:
- 42% of Americans have been contributing to their savings through automatic transfer or direct deposit during the course of the year.
- That's down from 47% in 2021.
- Only 37% of consumers are currently saving with a specific goal in mind.
- From that share, 49% said they were interested in the ability to track a goal and its progress directly through their bank
- 51% said they’d like a reward when achieving their goal.
- 32% of consumers have incurred at least one overdraft fee over the past year.
- 50% of respondents expressed the hope that their banks could offer small-dollar loans as a solution to their current struggles.
“Now is the time for banks to consider what actions they can take to continue growing, including improved incentives to financial wellness support,” said FICO principal consultant Glenn Grossman. “It’s ultimately about finding new ways to meet their customers’ needs and better help them out directly on their financial journey.”
Photo: Intellectual / Pixabay
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