Americans' Money Plans for 2014: Save More -- and Spend More
The trend toward fiscal responsibility continues when it comes to the number of people who say they plan to set a budget or stick to a spending plan within their budget: 38 percent in 2014, compared to 23 percent in 2013.
However, don't let this renewed focus on saving and budgeting lead you to believe that we're entering a phase of austerity. The "Spending and Savings Tracker" also reveals that consumers have big plans to spend their money, too.
How We Plan to Save
While the dedication to improving finances seems to be rising, the strategies to achieve those savings goals have not changed much since 2013. Respondents plan to:
- Sock away more of their paycheck from primary income (53 percent in 2014 vs. 51 percent in 2013).
- Save at least part of their tax refund (26 percent both years).
- Cut back on small luxuries (21 percent vs. 23 percent in 2013).
- Play the lottery in the hopes (or assumption?) that they will win (19 percent vs. 21 percent in 2013).
- Sell personal possessions (18 percent both years).
The American Express survey found that 48 percent of Americans are feeling confident about their finances going into the new year. In 2010 just 32 percent of respondents reported feeling confident. That confidence is going to translate into cash registers ringing. This year, across all income groups, consumers say they are ready to loosen the purse strings and splurge on travel, home improvement, new cars, and little luxuries.
- Of those surveyed, 34 percent plan to spend more this year than last on upgrading or remodeling their homes, compared to 31 percent in 2013
- Thirty percent plan to spend more money in 2014 on clothes, shoes, jewelry and accessories than they did last year, compared to 28 percent in 2013.
- Twenty-four percent say they'll buy a car this year compared to 26 percent in 2013. Still, potential buyers are keeping an eye on price, with the reported average amount they plan to spend dropping by 7 percent to $18,946. Even affluent Americans surveyed, who have a minimum annual income of $100,000, said they plan to spend 16 percent less than last year on a car, at an average price of $29,763.
- Eight percent plan to buy a home this year, which is similar to 2013. But these buyers expect to spend 45 percent more than last year, with an average price of $179,140.
Motley Fool contributor Michele Lerner has no position in any stocks mentioned. The Motley Fool recommends American Express. Try any of our newsletter services free for 30 days.