Economy

Americans More Negative Than Usual About Personal Finances

by Jeffrey M. Jones

Equally likely to report being better off or worse off compared with a year ago

PRINCETON , NJ -- A recent USA Today/Gallup poll finds Americans are as likely to say their personal financial situations have gotten worse in the past year as to say they have gotten better. This is generally in line with what Gallup has found the past two years, though, historically, Americans have usually been more likely to rate their situation as improving. When asked to look ahead to next year, Americans remain typically optimistic that their finances will improve.

Personal Financial Situation Compared With a Year Ago

The Oct. 10-12 poll finds 39% of Americans saying they are financially better off than a year ago, and 39% saying they are worse off. Twenty-two percent volunteer that there has been no change in their personal financial situation over the past 12 months.

Gallup has asked this question on 94 separate occasions since 1976. Typically, Americans have been more likely to report that their situation is improving rather than worsening -- the averages are 39% getting better, 32% getting worse.

Americans have tended to rate their personal financial situation more pessimistically during bad economic times for the country, such as during the recessions of the early 1980s, early 1990s, and in 2002. In contrast, during the boom years in 1999-2000, Americans were generally twice as likely to say their financial situation was getting better than getting worse.

Although the national economy is not currently in a recession, Americans ratings of it are negative at this time. The fact that personal financial evaluations are influenced by one’s view of the national economy are reinforced by the finding that 55% of those who rate current economic conditions as good say their financial situation has gotten better (22% say it has gotten worse). While 54% of those who rate national economic conditions as poor say their financial situation has gotten wore (26% say it has improved).

Analysis of this personal financial situation measured by subgroup suggests that difficult economic times disproportionately affect those residing in low-income households. While a majority of those in upper-income households report that they are personally better off than a year ago, nearly two in three Americans in lower-income households say their situation has gotten worse in the past year.

Younger Americans also appear to be doing better financially than older Americans -- those younger than 50 are more likely to report that their situation has improved, while those aged 50 and older are more likely to say their situation has gotten worse in the past year.

A statistical analysis of the data strongly suggests that income more powerfully predicts how one rates his or her financial situation than age does.

There is evidence that Americans’ evaluations of their personal finances are not immune to political forces. For example, those who approve of the job George W. Bush is doing as president are more likely to say their own financial situation has improved in the past year, while those who disapprove of Bush are more likely to say their situation has gotten worse. Similarly, Republicans report improving personal finances, while Democrats report deteriorating finances (independents are equally likely to say their situation has gotten better as to say it has gotten worse).

Ratings of Personal Financial Situation Compared With a Year Ago
By Presidential Job Approval and Party Affiliation

Group

Better off

Worse off

 

%

%

Approve of Bush

49

25

Disapprove of Bush

35

46

 

 

 

Republican

46

31

Independent

38

39

Democrat

36

44

These political effects persist even when taking into account the other major predictors of personal financial evaluations, such as household income and age.

Expectations for Personal Financial Situation a Year from Now

The second of the pair of Gallup personal finance questions asks Americans if they expect to be financially better off or worse off in 12 months. Currently, 57% of Americans think they will be better off and 22% worse off. Those numbers are right in line with the historical averages since 1977 of 56% “better off” and 19% “worse off.”

Almost every subgroup -- even those residing in lower-income households -- expects to be better off financially next year.

Senior citizens -- who are about equally likely to say they will be better off next year as to say they will be worse off -- are a notable exception. This conforms with the fact that many older Americans rely on fixed income payments from Social Security and pensions.

Implications

Americans’ pessimism about the national economy often colors the way they view their own finances, and that appears to be the case now. Gallup has found that Americans are currently negative about the national economic scene, and they are more negative about their own finances than has typically been the case in the past. But, Americans remain optimistic that things will get better for themselves over the next year.

Survey Methods

These results are based on telephone interviews with a randomly selected national sample of 1,009 adults, aged 18 and older, conducted Oct 12-14, 2007. For results based on this sample, one can say with 95% confidence that the maximum error attributable to sampling and other random effects is ±3 percentage points. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.

14. Next, we are interested in how people’s financial situation may have changed. Would you say that you are financially better off now than you were a year ago, or are you financially worse off now?

 

Better
off

Worse
off

Same
(vol.)

No
opinion

 

%

%

%

%

2007 Oct 12-14

39

39

22

*

 

 

 

 

 

2007 Jan 15-18

50

30

19

1

2006 Feb 9-12 ^

37

39

24

*

2005 Jul 22-24

42

40

17

1

2005 Jan 14-16

40

33

27

*

2003 Nov 10-12

41

38

21

*

2003 Jul 18-20

36

39

25

*

2003 Apr 14-16

31

39

29

1

2003 Feb 17-19

39

41

20

--

2002 Dec 16-17

33

44

23

*

2002 Jul 22-24

32

45

23

*

2002 May 20-22

37

36

26

1

2001 Dec 14-16

37

37

25

1

2001 Sep 7-10

37

36

26

1

2001 Aug 16-19

37

41

21

1

2001 Jul 19-22

39

36

25

*

2001 Jun 11-17

42

37

20

1

2001 Apr 6-8

42

36

22

*

2001 Feb 1-4

46

30

23

1

2001 Jan 10-14

49

30

21

*

2000 Oct 6-9

55

22

22

1

2000 May 18-21

53

26

20

1

1999 Oct 21-24

56

19

24

1

1999 Aug 24-26

53

25

22

*

1999 Jun 4-5

57

20

22

1

1999 Jan 15-17

58

21

21

*

1998 Oct 29-Nov 1

53

24

22

1

1998 Mar 20-22

55

20

24

1

1997 Jun 26-29

44

26

29

1

1997 May 6-7

45

28

25

2

1996 Mar 8-10

49

21

29

1

1994 Dec 16-18

40

31

29

*

1994 May 20-22

40

33

26

1

1994 Mar 7-8

34

31

34

1

1993 Dec 4-6

36

31

33

*

1993 Jun 28-29

29

34

36

1

1992 Feb 6-9

34

46

19

1

1992 Jan 16-19

30

43

26

1

1991 Dec 5-8

33

40

26

1

1991 Oct 24-25

26

44

28

2

1991 Oct 17-20

35

42

22

1

1991 Sep 5-8

34

28

37

1

1991 Jul 11-14

34

32

33

1

1991 May 16-19

32

32

33

3

1991 Apr 11-14

29

33

36

1

1991 Mar 21-24

31

37

32

1

1991 Feb 28-Mar 3

37

28

34

1

1991 Feb 14-17

37

28

35

*

1991 Jan 11-13

27

33

39

1

1991 Jan 3-6

35

32

32

1

1990 Dec 13-16

38

36

26

*

1990 Nov 15-16

25

42

32

1

1990 Oct 25-28

38

35

26

1

1990 Oct 18-21

27

41

30

2

1990 Oct 11-14

32

41

26

*

1990 Sep 27-30

40

32

27

1

1990 Aug 9-12

43

29

27

1

1990 Jul 19-22

44

27

28

1

1990 Feb 8-11

49

24

26

1

1989 Jun 15-18

42

25

31

2

1989 Jan 24-28

44

26

28

2

1988 Sep 9-11

53

23

23

1

1988 May 13-15

47

24

28

1

1987 Aug 24-Sep 2

43

29

27

1

1987 Jun 8-14

43

32

24

1

1987 Mar 14-18

46

30

23

1

1987 Jan 16-19

39

28

33

*

1986 Sep 13-17

40

29

29

2

1986 Jul 11-14

39

25

35

1

1986 Jun 9-16

46

28

25

1

1986 Mar 4-10

46

30

24

*

1986 Jan 10-13

40

30

29

1

1985 Oct 11-14

38

27

34

1

1985 Jun 10-23

43

29

26

2

1985 Mar 8-11

47

25

27

1

1984 Nov 30-Dec 3

43

24

32

1

1984 Sep 7-9

39

26

34

1

1984 Jul 6-9

40

25

34

1

1984 Mar 16-19

36

26

37

1

1983 Jun 24-27

28

39

32

1

1983 Mar 11-14

25

46

28

1

1982 Nov 5-8

29

37

33

1

1982 Sep 17-20

27

39

32

2

1982 Jul 30-Aug 2

25

46

26

3

1982 Apr 23-26

28

39

31

2

1982 Feb 5-8

28

47

24

1

1981 Oct 2-5

28

43

28

1

1981 Jun 26-29

33

35

30

2

1980 Jan

30

24

45

1

1979 Jun

30

27

41

2

1978 Jul

35

31

32

2

1978 Mar 31-Apr 3

29

32

37

2

1977 Aug

39

28

31

2

1976 Sep

33

36

30

1

^ Asked of a half sample.

15. Looking ahead, do you expect that at this time next year you will be financially better off than now, or worse off than now?

 

Better
off

Worse
off

Same
(vol.)

No
opinion

 

%

%

%

%

2007 Oct 12-14

57

22

18

3

 

 

 

 

 

2007 Jan 15-18

65

19

12

4

2005 Jul 22-24

59

25

14

2

2004 Jan 14-16

60

22

14

4

2003 Nov 10-12

63

21

13

3

2003 Jul 18-20

60

21

16

3

2003 Apr 14-16

63

16

17

4

2003 Feb 17-19

64

20

12

4

2002 Dec 16-17

61

20

13

6

2002 Jul 22-24

67

14

13

6

2002 May 20-22

69

15

12

4

2001 Dec 14-16

69

12

15

4

2001 Sep 14-15

58

26

14

2

2001 Sep 7-10

61

20

15

4

2001 Aug 16-19

66

18

13

3

2001 Jul 19-22

64

18

13

5

2001 Jun 11-17

62

22

11

5

2001 Apr 6-8

62

18

15

5

2001 Feb 1-4

61

19

16

4

2001 Jan 10-14

63

21

13

3

2000 Oct 6-9

68

11

15

6

2000 May 18-21

67

13

14

6

1999 Oct 21-24

68

13

12

7

1999 Aug 24-26

67

13

16

4

1999 Jun 4-5

67

17

12

4

1999 Jan 15-17

68

14

14

4

1998 Oct 29-Nov 1

66

12

16

6

1998 Mar 20-22

71

9

14

6

1997 Jun 26-29

59

17

20

4

1997 May 6-7

60

20

17

3

1996 Mar 8-10

66

16

11

7

1994 Dec 16-18

63

17

17

3

1994 May 20-22

59

21

16

4

1994 Mar 7-8

53

22

19

6

1993 Dec 4-6

56

18

22

4

1993 Jun 29-30

49

14

32

5

1992 Nov 19-20

53

18

20

9

1992 Mar 26-29

51

28

16

6

1992 Feb 6-9

54

28

14

4

1992 Jan 16-19

51

28

15

6

1991 Dec 5-8

54

21

17

8

1991 Oct 24-25

45

25

19

11

1991 Oct   17-20

55

23

16

6

1991 Sep 5-8

53

19

22

6

1991 Jul 11-14

57

15

19

9

1991 May 16-19

57

16

19

8

1991 Apr 11-14

56

17

18

9

1991 Mar 21-24

56

18

20

6

1991 Feb 28-Mar 3

64

9

20

7

1991 Feb 14-17

57

15

20

8

1991 Jan 11-13

41

25

21

13

1991 Jan 3-6

52

20

18

10

1990 Dec 13-16

58

18

17

7

1990 Nov 15-16

42

31

17

10

1990 Oct 25-28

50

15

27

8

1990 Oct 11-14

48

30

13

9

1990 Sep 27-30

51

20

17

12

1990 Aug 9-12

57

20

16

7

1990 Jul 19-22

58

17

18

7

1990 Feb 8-11

65

13

16

6

1989 Jun 15-18

58

13

20

9

1989 Jan 24-26

61

13

19

7

1988 Sep 25-Oct 1

67

9

17

7

1988 Sep 9-14

54

14

29

3

1988 May 13-22

54

10

31

5

1988 May 2-8

63

9

17

11

1988 Jan 8-17

46

18

30

6

1987 Dec 16-17

61

15

17

7

1987 Oct 22-23

52

21

16

11

1987 Aug 24-Sep 2

56

16

20

8

1987 Jun 8-14

57

17

18

8

1987 Mar 14-18

59

17

18

6

1987 Jan 16-19

52

16

26

7

1986 Sep 13-17

57

16

19

8

1986 Jul 11-14

51

15

28

6

1986 Jun 9-16

57

17

20

6

1986 Mar 7-10

61

18

16

5

1986 Jan 10-13

53

15

25

7

1985 Oct 11-14

49

12

32

7

1985 Jun 10-23

52

19

19

10

1985 Mar 8-11

57

12

26

5

1984 Nov 30-Dec 3

50

17

28

5

1984 Sep 7-10

53

9

28

10

1984 Jul 6-9

52

12

28

8

1984 Mar 16-19

54

11

28

7

1983 Jun 24-27

43

19

28

10

1983 Mar 11-14

45

22

24

9

1982 Nov 5-8

41

22

27

10

1982 Sep 17-20

41

25

25

9

1982 Jul 30-Aug 2

37

29

24

10

1982 Feb 5-8

42

31

21

6

1981 Oct 2-5

40

31

21

8

1981 Jun 26-29

44

25

23

8

1980 May 16-19

41

28

23

8

1980 Jan

36

24

31

9

1979 Jun

33

27

30

10

1978 Jul

38

30

20

12

1978 Mar 31-Apr 3

40

23

29

8

1977 Aug

47

27

17

9

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