April 28, 2020

Savings and debt during COVID-19: Future of Money Snapshot Report

Toilet paper shortages, online meeting overloads and streaming workouts aren’t the only things changing in today's world. Now that we are well into the midst of the crisis, we can look at the real economic impact: tracking the way people are working, spending and managing their finances. 

The Logica Research Future of Money study reveals the latest on important metrics to help companies understand financial behavior during the pandemic. Our series of snapshot reports will quickly highlight money-centric insights for deeper audience understanding. In this second report of the series, we examine the impact of COVID-19 on personal money management: savings and debt.

  • Almost one-third of Americans (31%) report preparing for a recession, though fewer women than men (26% women vs. 36% men are prepared).
  • The top 3 ways Americans are preparing for a recession is by setting aside money (76%), eliminating expenses (52%), and looking for additional work (23%). They also are changing investments (20%), moving investments to cash (15%), seeking financial advice (13%), borrowing money from friends/family (6%) or applying for a loan (5%).
  • Just over half (54%) of Americans have enough income to cover their monthly expenses but the other half have just enough to cover their monthly expenses but nothing leftover (29%) or end up short (17%).
  • Of those who end up short, they primarily go without (54%) or miss a bill or payment (44%), borrow (28%) or put expenses on credit card (22%); 14% tap into savings.
  • Not only do 17% of Americans end up short each month, but also one in five (20%) Americans don’t have enough savings to cover a month of expenses. More women than men do not have enough savings  to cover a month of expenses (24% of women vs. 15% of men). 
  • One quarter (26%) of Americans say they are tapping into savings more now than they did before the coronavirus crisis started.

 

Almost one-third (31%) of Americans are preparing for a recession:

Preparing for a recession

 

Most Americans have the ability cover expenses in a regular month:

American current ability to cover monthly expenses

 

Those who end up short each month primarily go without, miss a payment, borrow or put on credit:

Making Ends Meet During the Pandemic

 

When it comes to savings, one in five Americans don’t have enough saved to cover a month of expenses right now:

Americans do not have enough savings

 

One quarter (26%) are tapping into savings more now than they did before the pandemic:

Tapping into Savings

 

Key Takeaways

  • The majority of Americans are stressed about their financial situation.
  • Many are taking steps to prepare for a recession, while others are struggling to cover expenses and are tapping into savings.
  • Women are being hit harder than men by the financial impact of the novel coronavirus.

 

To hear more about the study, what’s coming up, and schedule time for a full presentation, email lraynor@logicaresearch.com

Click here for the prior Future of Money special report on income.

 

About the Logica Research Future of Money Study

The Future of Money Study is designed to provide insights to organizations to help improve people’s financial lives. Logica Research has been conducting the semi-annual Future of Money Study since the Spring of 2017. The focus of the study is to understand the consumer mindset around how people make, spend, save, and invest money. The insights are based on an online survey of 1,000 U.S. Adults 18 and over, balanced on gender, income, and generation and 200 older Gen Zers (16-23), not included in total.  Results are not weighted.  Gen Z defined as age 16-23, Millennials as age 24-39, Gen X as age 40-55, Boomers as age 56-74 for 2020. The study was fielded April 8-13, 2020.