INFLATION, POOR CREDIT AREAS OF CONCERN
Nearly three-quarters of Americans (72%) feel confident they will achieve their financial goals, according to a new WSFS Bank survey.
WSFS is based in Wilmington
However, 39% said they’re not confident they can keep pace with inflation’s impact on goods and services, and nearly a quarter say having poor credit prevents them from using financial products and services.
The study, which surveyed 1,500 consumers nationally and 1,750 in the Greater Philadelphia and Delaware region, gauged the financial goals, confidence, and access of those 18 years and older.
Top of mind for nearly half of all respondents (49%) is the need to build emergency funds for themselves and their families, compared with 54% regionally. Seventy-six percent said they were somewhat or very confident they would be able to achieve this goal, with 72% of regional respondents feeling the same.
“The impacts of inflation are being felt by many consumers, which can also hamper goals to build savings and emergency funds, purchase a home and more,” said Vernita Dorsey, senior vice president, director of community strategy at WSFS Bank. “While it could be getting difficult to save, it is still a key way to protect yourself from the changing economic and social-economic influences around us. Consider opening a money market or higher interest-bearing account for your savings, shopping for bargains, and re-evaluating your budget regularly to cut unneeded expenses, and if you need help reach out to your local banker or a financial advisor.”
Black respondents (51%) were more likely to cite improving their credit score as a goal than total respondents (41%), with 90% of Black respondents saying they feel confident they will achieve it. Meanwhile, more Hispanic respondents (36%) cited buying/affording a home or apartment as a goal than total respondents (26%), with 68% of Hispanic respondents saying they are confident they will achieve it.
Financial access and confidence
While the study found that 83% in the national sample feel financial products from traditional financial institutions are accessible to them, there are still obstacles to overcome for many,
Among the challenges, 32% cited high costs and fees, and nearly one-quarter (24%) said having poor credit is a reason they may not be using financial products and services from traditional financial institutions.
“Building and maintaining a strong credit score, generally one above 700, can be key to achieving your financial goals, as it can impact the rate offerings for your mortgage, loans and more,” said Dorsey. “If you find your score still needs work, start by paying down loans and credit with the highest interest rates and try to get your debt-to-credit ratio below 30% to avoid negatively impacting your score. Checking your credit report from the major credit bureaus periodically can also help identify inaccuracies or even fraudulent items that could be bringing your score down.”
More than eight in 10 said they were confident managing their money in general, but nearly three-in-10 have trouble understanding the financial products available to them, with 28% saying they are not confident knowing which products are best for them.
Personalized advice and services
Banks and financial service providers (32%) were second on the list of sources people lean on for money management skills behind parents and guardians (48%). Sixty percent said they use online banking and nearly as many use their bank’s mobile app (54%) to help them manage their finances, but many are still searching for more help.
Black (53%) and Hispanic (52%) respondents nationwide were more likely to agree that financial institutions have in mind what is best for them compared to white (41%) and non-Hispanic (42%) respondents. Regionally, 44% of Black and 43% of Hispanic respondents agreed with this statement as compared to 35% of white and 35% of non-Hispanic respondents.
The study was conducted by research company Opinium. The sample includes 1,500 national respondents and 1,750 in the Greater Philadelphia and Delaware region who reside in five southeastern Pennsylvania counties (Bucks, Chester, Delaware, Montgomery and Philadelphia), four southern New Jersey counties (Atlantic, Burlington, Camden and Gloucester), and all three Delaware counties (Kent, Sussex, and New Castle). The online survey was conducted from March 7-19, with a combined regional and national margin of error of +/- 2.5 percent.
