This week, we asked the Invstr Community what their personal opinion is on the effects the economy has had on their own spending habits. The winner, with almost half of the votes, was the 36 percent of Invstrs who believe that they are spending more despite relatively higher prices. This certainly matches up with recent consumer data from the previous months, which depict a persistent trend of growth throughout 2023. With May’s retail sales rising a surprising 0.3%, there is a conclusive average growth that may signal household savings is on the rise. As the market has rallied from arguably October of last year, there is a chance consumers may be holding more cash in their wallets through positive returns. Higher wages across the labor market may also point to the ineffectiveness the economic climate has had in changing consumer behavior.
In second place, we have the 29% of Invstrs who believe that they have been spending less throughout this period of high inflation. One particular issue with the overall growth in consumer spending is credit. Credit debt totals in the US are on track to surpass a record $1 trillion, but there may be several people who simply aren’t willing to go into debt with such large economic uncertainty. Others could simply see higher prices and begin to either bargain shop or hold off on any major purchases.
In third place, we have the 18% of Invstrs who believe that their spending has remained the same, with their natural consumer behavior unchanged with historically higher prices. There is a mighty minority amongst consumers that doesn’t let economic factors predict their spending. This could mainly be due to larger savings accumulated beforehand, thus posing no effect on a person’s willingness to buy or hold off. Recent strides in the market, like that of the tech bubble during the pandemic, could explain why spending levels are entering back into normative levels.
To close out the podium, we have the 17% of Invstrs who choose to never track their spending, therefore they wouldn’t know if any external economic factors may be affecting them. When it comes to budgeting, this may not be the wisest approach to surviving recessionary environments. Everyone who has savings or owns some type of bank account should always monitor their spending, ensuring that they are not only set up for retirement but are able to support their kids in the future. Whether done through an app, notes, or memory, everyone should track their purchases to guarantee they are not taking away more than they are putting in.
Do you feel prices are still lingering much higher than they use to? Have fun and see you next time with more poll results!
- The Invstr Team 🙂