Americans are concerned about rising prices and inflation

Americans are starting to feel less financially secured in 2022 than in 2021

Americans are feeling less financially secure in Q1 2022 (56%) compared to Q4 2021 (61%) and Q2 2021 (62%). Importantly, financial security sentiment is on similar lines as expressed in 2020 (55% in Q4 2020 and 52% in Q3 2020). Most Americans are confident in their ability to pay off debts (81%); three percent down from Q4 2021 (83%).  The decrease in financial security in 2022 is likely contributing to fewer Americans saying that they have been able to set aside money for savings or investments in Q1 2022 (57%) than in Q2 2021 (66%).

Older Americans are leading their younger counterparts on many positive attitudes about their finances and financial security. Baby Boomers (64%) are significantly more likely to feel financially secure than Gen X (56%), Millennials (53%), or Gen Z (43%). Similarly, Baby Boomers (90%) and Gen X (84%) are more likely to be confident in their ability to repay their debts than Millennials (80%) or Gen Z (67%).

When it comes to retirement, fifty-nine percent of Americans in Q1 2022 say they are confident that they will have enough money to enjoy a comfortable retirement; down five percent from Q4 2021 (64%). Baby Boomers (70%) are most confident in their ability to retire comfortably, while Gen X (59%), Millennials (49%), and Gen Z (48%) feel significantly less confident they’ll have enough to retire comfortably when the time comes.

Americans worry how the events of the past several years will affect their financial future

There is no doubt the past several years have been tumultuous and difficult for a lot of people. Americans worry about how these events will impact their financial future. Inflation, the pandemic, medical cost, interest rates, even global events could be causing harming individuals' ability to reach their long-term financial goals.

About half of Americans think inflation could have a big negative impact (54%) on their ability to reach long-term financial goals such as buying a house or being able to retire comfortably when the time comes; 33% expect it to have a medium or small impact. Only five percent expect inflation will have no impact on their long-term financial goals.

Interest rates, medical costs, and global events are also expected to have a negative impact on long-term financial goals, although not quite as severely as inflation –  about one in three believe each of these will have a big impact and two in five say each will have a medium or small impact. About one in ten expect interest rate (9%), medical costs (9%), and/or global events (8%) will have no impact on their long-term financial goals.

Americans are least likely to expect COVID-19 (26%) and/or the job market (27%) will have a big negative impact on their long-term goals and most likely to say they will have no impact (15% and 23%, respectively).

Americans say several important financial life goals are difficult to achieve in 2022

Many Americans think big financial goals are getting difficult to achieve in today’s world. About seventy-one percent of Americans say buying a house is a difficult financial goal to reach. Highest among 25-34 years old (79%) which is arguably a prime house-buying age group. The second most difficult financial goal is paying off all debt (61%). A similar number, about three in five, say it is difficult to save for retirement (59%). Further, about three in ten 25-49 year olds say it is very difficult to save for retirement (28%).

Other financial goals Americans feel are difficult to achieve in today’s world include:

• Starting/raising a family (54%)
• Buying a car (53%)
• Traveling/taking big trips (50%)
• Investing in the stock market (38%)

Nearly all Americans are concerned about rising prices and inflation in Q1 of 2022

Americans have noticed a change in the price of many different goods and services across industries in the past three months. The majority of Americans have noticed higher prices on gasoline (92%), groceries (88%), eating out at restaurants or take out (76%), utilities (62%), and travel (60%).

Although they are less likely to have purchased them in the past three months, when they do, Americans also notice a higher price in are buying a new home (60%), home renovations/repair (58%), buying a new car (57%), home upgrades (57%), clothing/accessories (54%), rent (42%), home/auto insurance (39%), and health insurance (38%).

About nine in ten Americans say they are concerned about inflation (91%). Importantly, six in ten say they are very concerned about inflation – up from 48% in Q4 2021. This high level of concern about inflation is held across all racial and ethnic groups and income levels. While all generations are concerned about inflation, older generations are more likely to express more intense concern about inflation than their younger counterparts, 65% of both Gen X and Baby Boomer are very concerned about inflation compared to 47% of Gen Z and 56% of Millennial.     

With economists reporting that inflation is currently increasing and likely to continue to increase throughout 2022, Americans are starting to think of what actions they can take to reduce spending and be able to pay for the things they need. About half of Americans say they will cut back on dining at a restaurant or take-out meals (46%), 30 percent say they will budget food/cut back on groceries, and about one in four Americans say they will drive less (26%) – they are twice as likely to say they will drive less compared to Q4 2021 (13%).

Other actions Americans are likely to take to reduce spending include:

• purchase less clothing/accessories (24%),
• keep current technology instead of upgrading (23%),
• cancel/put off travel plans (23%), or

put off home renovations/repairs (22%).

The increasing interest rates for mortgages and/or loans are forcing Americans to wait before making big purchases

About seven in ten Americans say that interest rates are increasing for mortgages and/or loans in the United States (66%). Conversely, about one in four Americans are not sure of the current state of interest rates (24%). Gen X (72%) is more aware of increasing interest rates than Millennials (60%) followed by Gen Z (49%). With rising interest rates in 2022, Americans are starting to or are likely to be putting off big purchases that will need them to take a loan (29%), cutting back on credit card use or paying off credit card balances (26%), or putting off purchasing a home or refinancing (22%).

Millennials (31%) are more likely to say they will put off purchasing a home or refinancing because of increasing interest rates than Gen Z (29%) and Gen X (27%). Gen X is more likely to cut back on credit card use or pay off credit card balances (29%) or put off big purchases that need a loan (31%) compared to other generations. Baby Boomers (15%) are making more changes to investments and/or retirement accounts than Gen Z and Millennials (12% of both groups). Interestingly, Gen Z is about twice as likely as Gen X to be saving more money in a traditional savings account (22% and 12% respectively).

About the Study

This Country Financial/Ipsos Poll was conducted March 18 - 20 2022, by Ipsos using the probability-based KnowledgePanel®. This poll is based on a nationally representative probability sample of 1,023 general population adults age 18 or older.

The margin of sampling error is plus or minus 3.3 percentage points at the 95% confidence level, for results based on the entire sample of adults. The margin of sampling error takes into account the design effect, which was 1.17. The margin of sampling error is higher and varies for results based on other sub-samples. In our reporting of the findings, percentage points are rounded off to the nearest whole number. As a result, percentages in a given table column may total slightly higher or lower than 100%. In questions that permit multiple responses, columns may total substantially more than 100%, depending on the number of different responses offered by each respondent.

The survey was conducted using KnowledgePanel, the largest and most well-established online probability-based panel that is representative of the adult US population. Our recruitment process employs a scientifically developed addressed-based sampling methodology using the latest Delivery Sequence File of the USPS – a database with full coverage of all delivery points in the US. Households invited to join the panel are randomly selected from all available households in the U.S. Persons in the sampled households are invited to join and participate in the panel. Those selected who do not already have internet access are provided a tablet and internet connection at no cost to the panel member. Those who join the panel and who are selected to participate in a survey are sent a unique password-protected log-in used to complete surveys online. As a result of our recruitment and sampling methodologies, samples from KnowledgePanel cover all households regardless of their phone or internet status and findings can be reported with a margin of sampling error and projected to the general population.

The data were weighted to adjust for gender by age, race/ethnicity, education, Census region, metropolitan status, household income, race/ethnicity by gender, race/ethnicity by age, and race/ethnicity by education. The demographic benchmarks came from the 2019 March supplement of the U.S. Census Bureau’s Current Population Survey (CPS). The weighting categories were as follows:

• Gender (Male, Female) by Age (18–29, 30–44, 45–59, and 60+)
• Race/Hispanic Ethnicity (White Non-Hispanic, Black Non-Hispanic, Other or 2+ Races Non-Hispanic, Hispanic)
• Education (High School graduate or less, Some College, Bachelor and beyond)
• Census Region (Northeast, Midwest, South, West)
• Metropolitan status (Metro, non-Metro)
• Household Income (Under $25,000, $25,000-$49,999, $50,000-$74,999, $75,000-$99,999, $100,000-$149,999, $150,000+)
• Race/ethnicity (White/Other Non-Hispanic, Black Non-Hispanic, Hispanic) by Gender (Male, Female)
• Race/ethnicity (White/Other Non-Hispanic, Black Non-Hispanic, Hispanic) by Age (18-44, 45+)
• Race/ethnicity (White/Other Non-Hispanic, Black Non-Hispanic, Hispanic) by Education (Some College or less, Bachelor and beyond)

About Ipsos

Ipsos is the world’s third largest Insights and Analytics company, present in 90 markets and employing more than 18,000 people.

Our passionately curious research professionals, analysts and scientists have built unique multi-specialist capabilities that provide true understanding and powerful insights into the actions, opinions and motivations of citizens, consumers, patients, customers or employees. We serve more than 5000 clients across the world with 75 business solutions.

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