Americans are prioritizing summer vacations despite financial constraints, reflecting a shift in spending habits, according to a new survey from MassMutual.
The latest edition of the quarterly Consumer Spending & Saving Index highlights key trends in financial behavior and sentiment. It draws from a survey, conducted online by PSB Insights, which covered a nationally representative sample of 1,000 US adults and an additional sample of 500 Massachusetts residents.
It found one-fourth of Americans expect to spend more this summer compared to last year, with most of that bigger dollar spend primarily directed toward gas, vacations, and local outings. Gen Z leads the surge, with one-third planning to ramp up their spending, followed by Millennials at 27 percent, Gen X at 24 percent, and the Silent Generation at 15 percent.
“Attending to the delicate balance of ‘wants’ with ‘commitments’ is very real, and even more real for many in today’s economic climate,” Shefali Desai, head of worksite with MassMutual said in a statement. “Many may be feeling that to afford a fun summer activity, they must forego other variable expenditures.”
Despite the enthusiasm for summer activities, inflation pressures are pushing many Americans to cut back on dining out, clothing purchases, and indulgences like massages or salon visits.
Touching on attitudes toward education and financial planning, the survey unearthed a mood of disillusionment among younger generations who feel an outsized burden from the student debt crisis.
Only 23 percent of both Gen Z and Millennials see significant value in their degrees, compared to 38 percent of Gen X and 53 percent of Baby Boomers. Many high school (38 percent) and college graduates (44 percent) in the survey also regret not starting their retirement savings earlier and wish they had avoided debt.
The feeling of parental influence on financial education remains strong, with 62 percent of Americans agreeing that their parents did a good job setting them up for financial success. Slightly slightly more respondents reported their mothers being an influence than fathers in teaching personal finance (59 percent vs. 53 percent, respectively), though dads were more likely than moms to talk about debt management (46 percent vs. 38 percent).
Among younger generations, Gen Zers (47 percent) report that their mothers were very influential, more so than Millennials (34 percent), Gen X (32 percent), Baby Boomers (28 percent), and the Silent Generation (24 percent).
Recession concerns are also on the rise, with 45 percent of Americans predicting an economic downturn within the next year, up from 37 percent in the previous quarter. Inflation worries are on people’s minds, with 42 percent believing it will have the greatest impact on their finances.
Despite these economic woes, consumer spending has not seen a significant decline, with 44 percent of respondents saying they are maintaining their spending habits. The survey also found the dream of retirement is fading for more Americans, with 21 percent saying they won’t ever retire, up from 17 percent in the previous quarter’s polling.
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