Americans feel they are in a good position to meet their 2024 fiscal goals. (iStock)
A recent study from Edward Jones shows that Americans who have weathered inflation and price increases are more optimistic about their finances in 2024, and more are setting financial goals for this year.
According to findings from Edward Jones, approximately 80% of Americans made at least one financial New Year's resolution for 2024, but the percentage of Americans who made and kept a financial resolution through 2023 was was only 22%. Increasing income is the top financial goal this year, cited by 17% of respondents. No. 2 (16%) said they were increasing their savings, and 15% said they planned to pay off credit card debt this year.
61% of Americans say the biggest challenge that could prevent them from achieving their fiscal goals is a prolonged period of high inflation. The latest inflation statistics show that inflation is moderating, but there are concerns that it may take a while to reach the Federal Reserve's target rate of 2%. That is to say. According to the CPI in November, prices rose at an annual rate of 3.1%, slowing from the 3.2% growth rate. Thirty-five percent of respondents said they had unforeseen financial burdens other than rising prices, and 35% said changes in economic markets could derail their 2024 financial resolutions.
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Reducing inflation will help Americans
According to Primerica, a sharp decline in gasoline prices and a slight decline in food prices, combined with continued strength in household incomes, contributed to an increase in the purchasing power of middle-income households. household budget index (HBI).
According to the index, the purchasing power of middle-income households with incomes between $30,000 and $130,000 will be 100.5% in November 2023, up from 99.1% in October. A year ago, the index was 93.7%.
But starting in 2021, the increased cost of essentials means these households have an average cumulative budget deficit of nearly $2,500. Americans are also facing record amounts of credit debt, with debt now at $1.8 trillion after racking up new spending totaling $48 billion in the third quarter of 2023, according to one report. It is said that he is holding Recent reports on household debt From the Federal Reserve Bank of New York.
“A lot has happened since January 2019, and it's a welcome outcome to finally see the index return to its baseline,” said Amy Cruz-Katz, economic advisor at Primerica. “But that doesn't mean everything is great. If the pandemic hadn't happened, the HBI would probably be about 10% higher than it is now, middle-income households would have more savings, and middle-income households would see inflation significantly outpacing their earned income. You don’t have to take on all the new credit card debt you took on while it was happening.”
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How to stay financially relevant in 2024
According to WalletHub, there are several steps consumers can take to boost their confidence and stay financially fit in 2024.
budget carefully
We'll give you an overview of your income, expenses, and debt to better understand your financial situation. Next, decide which luxuries you can cut back or eliminate to free up more money to pay off debt or increase your savings.
Establish an emergency fund
Wallet Hub said consumers should build an emergency fund by saving a small amount of money each month until they have three to six months worth of expenses.
“This fund acts as a financial safety net, providing peace of mind when faced with unexpected expenses,” WalletHub said.
Pursue a side job to earn extra income
One way to generate additional income is to expand your income streams through side hustles, part-time work, or freelance opportunities. Consumers can also ask their current employer for a raise.
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