Americans of all ages are living like retirees to keep ahead of economic strain

Taking risks during uncertainty for the market and economy may be right for some investors, but for the average American a more conservative route is preferred.

With so many unknowns for the economy, not least where trade policy might veer off to next, whether tax cuts are going to be delivered, and whether recession is imminent, many Americans are shoring up their finances.

A new survey from Affirm, conducted by Talker Research, shows that 86% of respondents feel economic uncertainty and 58% do not think the US will avoid recession. These beliefs are driving half of those who took part in the poll to save cash for emergencies – although a recent report suggests confusion about the best way to save - and 41% want to ensure their payments are regular and fixed amounts to help with budgeting.

Most people think that the economy will be uncertain for the next 10 months and are taking steps such as avoiding credit card interest and focusing on the elements of their finances that they can control rather than external factors.

It’s almost like Americans of all ages are adopting the kind of strict controls on their finances that retirees on fixed incomes do, with a strong focus on avoiding surprise fees on purchases and wanting certainty on the timing and amount of bills.

The survey of more than 2000 people also found that many respondents want tools to help them manage their finances and are demanding greater transparency, clarity, and predictability from their financial providers.

However, despite the best intentions, recent research reveals a decline in confidence among Americans in being able to financially support all the things they want to do in life – 70% said they are confident, down from 83% in January 2020.