New York Life Wealth Watch 2024 outlook: Financial confidence grows, while credit card debt looms.

Despite high confidence levels and increased savings, American adults continue to face challenges, including higher costs of living and rising credit card debt.

• Among those with credit card debt, the average total debt owed is $7,931.80 – an increase compared to 2022, when the average owed was $6,320.98.
  • Although most adults with credit card debt are contributing the same or more each month than they did in 2022 to pay off their debt (77%), around a quarter (23%) report contributing less.
  • On average, those with credit card debt report contributing $363.07 per month toward paying it off – slightly less than what adults reported in 2022 ($430 per month).
  • 1-in-4 women (25%) and 30% of Gen Xers with credit card debt report contributing less to paying down their credit card debt in 2023 than 2022.
• More than half of adults (62%) report inflation as their top financial concern that may impact their finances heading into 2024, followed by rising interest rates (29%), and potential recession (28%).
  • These are the same concerns as those reported in late 2022. At that time, 68% of adults were concerned about inflation, 26% worried about a possible recession, and 29% were concerned about rising interest rates.
• 4-in-10 adults (43%) expect their living expenses to be higher in the first 6 months of 2024 than in 2023.
• An overwhelming majority of adults (85%) reported their finances were impacted adversely in 2023.
  • 58% of adults reported that inflation impacted their finances the most, followed by credit card debt (28%), and the cost of housing (26%).

“Although economic data point toward growth – and the findings of this Wealth Watch 2024 Outlook are fairly positive – consumer confidence is hovering near 2008-2009 levels,” said Froshiesar. “For a variety of reasons, adults are not experiencing a strong economy in their day-to-day financial lives, and we are seeing acute challenges among specific demographic groups. Specifically, women and Gen Xers are showing less confidence in achieving their financial goals compared to men and other generational groups, as well as more difficulty managing credit card debt.”

Despite broader financial challenges, nearly half of adults report having emergency savings and younger generations in particular are taking a proactive approach to financial strategies moving into the New Year.

• Two-thirds of adults (66%) report having a financial strategy in place, and almost half of adults (46%) report reviewing their financial strategy or budget at least monthly.
• Just under half of adults (48%) have emergency savings, with adults having an average of about $15,027.74 set aside.
  • Men are more likely to have funds or savings set aside compared to women (55% vs 41% respectively).
  • Millennials (51%) and Baby Boomers (51%) are more likely to have funds or savings set aside compared to other generations (Gen Zers: 44% and Gen Xers: 43%).
• 73% of adults took an action as a response to factors impacting their finances in 2023 – with cutting back on discretionary spending (48%) and making changes to their budget or financial strategies (31%) being the top ways.
  • Gen Zers and Millennials were more likely to develop a secondary income stream (20% for both) or seek guidance from a financial professional (11% and 15% respectively) compared to other generations as a response to factors impacting their finances in 2023.
• Two-thirds of adults with debt (64%) report adjusting their strategy for managing their debts in the past year. The most common change has been to pay more than the minimum per month to manage their debt (28%).
  • Gen Zers (79%) and Millennials (74%) are more likely to report their strategy has changed in the past year compared to older generations.
• Financial goals moving into 2024 closely mirror those reported for 2023:
  • 7-in-10 (72%) adults currently have a short-term financial goal, with the top three goals reported being paying for a vacation (28%), buying themselves a specific product they want (24%), and buying a car (23%).
  • 8-in-10 (80%) adults currently have a long-term financial goal for 2024, with building their emergency funds (41%) and paying off credit card debt (32%) being the most common.

“Moving into 2024, individuals report maintaining the same long-term financial goals they were working towards entering 2023. It’s encouraging to see that even in a challenging economic environment, Americans are maintaining focus on saving, managing debt and building a plan for the future. This will help them weather financial shocks or unexpected expenses in the future and set them up for longer-term financial success. It’s also encouraging to see that Gen Zers aren’t lagging too far behind other demographic cohorts in this area,” said Froshiesar. “As younger generations continue to focus on building strong foundations for their lifelong financial journeys, having a holistic financial strategy in place, and revisiting that strategy on a regular basis with the guidance of a financial professional, will be pivotal.”

ABOUT WEALTH WATCH                                 

Wealth Watch is a recurring survey from New York Life that tracks Americans’ financial goals, progress toward those goals and feelings about their ability to secure their financial futures, identifying key themes and trends that are emerging about topics like retirement planning, the role of protection-oriented solutions and the importance of financial guidance.

SURVEY METHODOLOGY

This poll was conducted between November 22 – 26, 2023 among a sample of 2,202 Adults. The interviews were conducted online and the data were weighted to approximate a target sample of adults based on gender, age, race, educational attainment, and region. Results from the full survey have a margin of error of plus or minus 2 percentage points.

ABOUT NEW YORK LIFE

New York Life Insurance Company (www.newyorklife.com), a Fortune 100 company founded in 1845, is the largest mutual life insurance company¹ in the United States and one of the largest life insurers in the world. Headquartered in New York City, New York Life’s family of companies offers life insurance, retirement income, investments, and long-term care insurance. New York Life has the highest financial strength ratings currently awarded to any U.S. life insurer from all four of the major credit rating agencies.²

1 Based on revenue as reported by “Fortune 500 ranked within Industries, Insurance: Life, Health (Mutual),” Fortune magazine, 6/5/2023. For methodology, please see http://fortune.com/fortune500/.

2 Individual independent rating agency commentary as of 11/17/2023: A.M. Best (A++), Fitch (AAA), Moody’s Investors Service (Aaa), Standard & Poor’s (AA+).

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