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U.S. consumers are still hesitant to change their spending habits, according to the American Express Spending & Saving Tracker, a new monthly study.
According to the report, which analyzed the views and spending motivators from 2,032 adults, which were collected at the end of August, 90 percent of consumers plan to maintain or decrease their level of spending over the next month. Half (50 percent) predict they will spend the same amount, and 40 percent plan to spend less. Only 10 percent plan to increase expenditure. The top reasons they plan on reducing their spending are to save money (49 percent) and reduce debt (37 percent).
Some demographics showed a higher willingness to spend, with 24 percent of young professionals (those under 30 years of age making at least $50,000 annually) planning to spend more, compared with only 14 percent of affluent consumers (those of all ages making $100,000 or more per year). But the majority still expects to spend the same (43 percent) or less (33 percent). Most affluents similarly plan to spend the same (50 percent) or less (33 percent).
Of those consumers planning to spend more, 49 percent reported that they would increase expenditure on groceries, as well as on clothing for themselves and their family members. They were also interested in spending on recreational activities, such as dining out (36 percent), travel (33 percent) and entertainment (31 percent). Entertainment and dining out were also listed as the top areas where consumers wanted to spend, at 73 percent and 77 percent, respectively.
But entertainment seemed to be a want more than a necessity for consumers, as it held the lowest spot on the list of consumer needs, with only 19 percent. Groceries topped the list, with 87 percent citing it, followed by tuition/education (84 percent), and clothes for family (65 percent). At the bottom of the list above entertainment was grooming/hygiene (25 percent) and dining out (23 percent).
“We may now be at a point when many consumers have taken stock of their financial situation and have a better handle on what their spending and saving plans are in the current economy,” said Pamela Codispoti, SVP and general manager, Cardmember Services at New York-based American Express. “I don’t think anyone expects the American consumer to quickly return to the spending levels of the last few years, but amid their cautiousness, we are seeing some areas where people are willing to increase spending.”