Taking control of your finances is more crucial than ever
As inflation persists, now is the time to get your financial house in order
By Glenn J. Williams
We’ve all seen it: Prices are on the rise at the pump, at the grocery store, at your favorite restaurant and on everything you buy.
As the pandemic winds down, rising inflation, broader economic uncertainty and international conflict threaten to upend many middle-income families’ sense of financial security.
“I feel the pressure to get my finances in order now more than ever,” said April Logan, 32, a single mom from Washington D.C. “I’m seeing price increases on everyday baby items, my go-to lunch carryout, groceries, gas, and many other things. Now is the time to cut back, set a budget and save.”
In Primerica’s most recent quarterly survey of middle-income households across the U.S., two-thirds (67%) of respondents said their income is falling behind the cost of living.
It doesn’t have to be this way.
Most families remain optimistic amid the turmoil, and many are taking steps to secure their financial future in light of the current economic headwinds. Nearly two-thirds (60%) of middle-income families in our latest Financial Security Monitor feel positive about their personal finances, and most are cutting back on regular spending or delaying major purchases.
Still, many feel anxious about tracking their financial health and don’t know where to start. They are spending more and piling up credit card debt. Plus, a lot of Americans have failed to save for a rainy day and couldn’t cover an emergency expense of $1,000 or more.
Ms. Logan says while she’s been saving more because of the pandemic and current economic situation, she still finds herself unsure of exactly what to do.
“I feel like I make smart financial decisions, but I don’t know what the future holds.”
The relatively stable economy of the past decade means many of these middle-income families are facing a period of volatility for the first time in their adult lives. And it’s time for those Americans to double down on getting their financial house in order. Unfortunately, many aren’t practicing good financial habits.
For example, most middle-income families in our survey said it’s smart to start saving and investing sooner rather than later. Yet many aren’t following their own advice. Nearly one-third (30%) said they don’t contribute to a savings account, follow a budget, contribute to an investment account, or set a financial budget each month. Among the biggest challenges people cite for keeping track of their finances are anxiety and lack of time.
Americans should start making sound financial decisions. Here are some ways to get started.
- Create a strategy for paying off debt. By paying off debt faster, money can be used to improve your financial situation.
- Invest something, even if it’s a little, and protect what you already have. There’s a misconception that you need to save hundreds of dollars a month, or don’t bother. That couldn’t be more wrong. The key thing is to get started with what you have.
- Protect your income. For a small price, you can protect your family from loss of income due to death by purchasing inexpensive term life insurance.
Glenn Williams is the Chief Executive Officer of Primerica, a leading provider of financial services to middle-income households in the United States and Canada.
Primerica is a leading provider of financial services to middle-income families in the United States and Canada. The company helps middle-income families learn the principles of personal finance, reduce consumer debt, plan for the unexpected, and gain access to appropriate financial products and services to protect their families and save for the future. Founded in 1977, Primerica is headquartered in Duluth, Ga where more than 1,800 employees work at its corporate office in Gwinnett County.