Consumers Are Trying To Manage Debt Better, Survey Shows
The fragile economy has jolted many Americans into a determination to reduce their credit-card debt, a survey on financial well being indicates.
While workers‚ primary long-term financial worry continues to be saving for retirement, paying off plastic and other short-term debt is in the forefront these days, according to the new quarterly Well-Being Index report from Principal Financial Group Inc. (PFG).
The survey of 1,500 employees at various firms also found that 25% have recently postponed major purchases, citing economic conditions. The credit-card debt concern is somewhat ironic, since a previous survey had found most people intending to spend at least as much over the year-end holidays as they had in 2000, when times were generally brighter.
"There was a Goldilocks mindset that things were going to get better and better," says Daniel Houston, senior vice president at Principal Financial, a financial services firm in Des Moines, Iowa. "But here we sit with roughly the same economic outlook we had six to nine months ago."
The Enron debacle apparently is causing significant rethinking about the security of retirement nest eggs. The survey found that about 30% of the respondents said they have made recent changes in their strategy. In the previous quarter, 17% had indicated they had reallocated assets from volatile to more stable kinds.
But despite rising concern about their well being, most respondents rely on family or friends rather than professionals for advice on investment decisions and financial options. Accountants, stockbrokers and insurance agents were consulted only by about 11% of those surveyed, Principal says.
The above was furnished by Dow Jones Financial Advisor Service. © Dow Jones. For a free trial, log on to www.fa-mag.com.