ACCC found that in 2022 American consumers started pulling back on spending in the second half of the year, as job cuts and freezes made it harder to pay down debt and impacted confidence in the economy.
United States, 13th Sep 2023, King NewsWire – American consumers started changing their spending habits in the second half of last year as job cuts and freezes impacted their ability to reduce debt and withered their confidence in the economy, according to a new white paper released today by American Consumer Credit Counseling (ACCC).
According to the ACCC white paper – “Tracking the Financial Health of American Households” – consumers were further forced to change their behavior amidst escalating gas prices, inflation, and seven increases in interest rates by the U.S. Federal Reserve – including a 0.75 percent hike in June 2022, the biggest since 1994.
The ACCC Financial Health Index was created to measure how Americans feel about their household finances and the overall U.S. economy. Read our Financial Health Index White Paper
The higher borrowing costs, which have continued to rise in 2023, make it more difficult for consumers to make big-ticket purchases such as cars and homes. But consumers have felt the pinch in everyday purchases as well, from groceries to entertainment.
“With interest rates continuing to rise, there is no question that moving forward, Americans need to learn how to reduce their reliance on debt in order to maintain the financial health of their households,” said Allen Amadin, President and CEO of American Consumer Credit Counseling. “Making use of tools and technology to track spending, banking, budgeting and planning will be essential to this process of not only changing spending habits, but learning how to live within a budget that is less dependent on loans to fund a lifestyle.”
Of all the trends, consumer concerns about their ability to reduce debt by even 10 percent proved the most worrisome, as it indicated a significant threat to the financial health of households across the U.S. Americans were falling behind on credit card, car, personal loan, and mortgage payments – making it hard for households to contribute to emergency savings funds that make it possible to weather economic shifts and downturns.
ACCC has found that Americans are starting to look for comprehensive apps to help them maintain a stable financial profile. A Financial Health Index survey earlier this year found that a quarter of consumers are now using mobile apps for managing financial management tasks and accounts.
In response to this demand, in the first quarter of 2024 ACCC will be launching CreditU – a one-stop debt and financial management mobile app that uses both AI technology and human interaction to enable users to take complete control of their finances. The feature-packed app consolidates a user’s checking, savings, loan, and other accounts into a single mobile smartphone interface, while delivering state-of-the-art tools for budget and expense tracking, credit monitoring, net worth calculation and the first-ever app-based debt management tool.
Thousands of consumers have already enrolled at CreditU.org for the CreditU pre-order waiting list, which is still open for new enrollees to sign up for free.
“From COVID-19 to the impact of war and international stability on costs, Americans have faced some of the most severe economic shocks in decades,” said Katie Ross, Executive Vice President of American Consumer Credit Counseling. “At ACCC, we are innovating our services by pairing our team of expert financial counselors with the power of technology through CreditU to ensure that we are prepared to help Americans remain financially stable and healthy.”
Organization: American Consumer Credit Counseling (ACCC)
Contact Person: Madison Block – ACCC
Country: United States
Release Id: 1309236332