With inflation now at the forefront of many Americans’ financial concerns, summer plans are poised to be dramatically different this year according to the latest “Consumer Spending & Saving Index” from Massachusetts Mutual Life Insurance Company (MassMutual).
To that end, inflation is upending Americans spending and savings habits. Americans are paying more for gas and groceries and cutting corners by delaying major purchases and investing less. Some are also turning to more volatile investments like cryptocurrencies.
As inflation has taken its toll on Americans’ wallets, many have exceeded their budgets in the last three months, particularly for groceries (49 percent) and gas (43 percent). Over half are delaying major purchases such as cars (42 percent) and major home repairs/improvements (38 percent). Despite some news of increases in salaries, over half of Americans (58 percent) say their incomes have stayed the same through the pandemic, with 57 percent also saying they expect their finances to remain about the same through the next year, pointing to a continued struggle for many.
On top of this, many Americans are rethinking their summer spending plans with restaurant, clothing and travel industries likely continuing to feel the budget cutbacks that began during COVID. Gas (57 percent) and vacations (36 percent) are the most common categories of new spending. Just under two-fifths of respondents (39 percent) plan to travel this summer, with Baby Boomers listing travel as a top spending priority (42 percent).
Among the 45 percent who are not planning to travel, the most common reason for staying at home is that inflation has made travel too expensive (49 percent). The most common areas Americans report they are aiming to decrease spending are eating out (85 percent), travel (66 percent) and new clothes (64 percent).
Commissioned by MassMutual, the research was conducted online by PSB Insights from May 16-24, among a nationally representative sample of 1,000 U.S. adults (ages 18-plus).
Source: MassMutual
Related Stories
Americans Still Prioritizing Vacations Amid Economic Concerns
Cruise Industry, Advisors React to CDC Dropping U.S. Entry Test
Commerce Sec. Unveils Strategy to Boost U.S. Travel and Tourism
Tourism to Contribute $2.6 Billion to U.S. GDP Over Next Decade