More evidence of less spending
by April 3, 2009 8:27 am 59 views
Americans continue to decrease spending on entertainment and eating out, and will most say they will use tax refund to pay down debt or boost savings.
A recent Harris Poll of 2,355 U.S. adults found that 74% say they will spend less in the next six months at restaurants and 74% said they will spend less on entertainment. A November study found that 65% intended to decrease restaurant spending.
Other results of the Harris Poll include:
• Two-thirds of Americans (65%) say it is not likely they will take a vacation away from home lasting longer than a week. while 35% say they will vacation away from home. In November, three in ten (29%) of Americans said they would be likely to take a trip;
• Large purchases will also suffer as more than three-quarters of Americans say it is not likely they will buy a new computer (78%), move to a different residence (80%), buy or lease a new car, truck or van (89%), purchase a house or condo (90%), start a new business (90%) or buy a boat or recreational vehicle (95%). These numbers are all very similar to November so people are still not ready to spend on the big-ticket items;
• Only one in five Americans (21%) say it is likely they will have more money to spend the way they want in the next six months which is slightly down from 25% in November; and,
People are split on saving or investing as 50% say it is likely they will save or invest more money while 50% say it is not likely they will do so, almost unchanged from November when 49% said they were likely to save or invest and 51% said it was not likely.
A report from ING Direct indicates that 71% of Americans who expect to receive a tax refund will save it, invest it or pay off debt.
“ While the arrival of a refund once meant a shopping spree to many, this year Americans are skipping the spring sales to boost their savings and eliminate debt,” ING noted in its report.
More than half (51%) of Americans expecting a federal tax refund this year said they are using their federal tax refund to cover basic household expenses, including an alarming 65% who are under the age of 35.
The ING survey results include:
• Almost half (46%) of Americans between the ages of 35 to 54 who expect to receive a federal tax refund this year intend to use it to pay off debt;
• One in four Americans expecting a federal tax refund (27%) plan to save their refund and one in three (39%) will pay off debt with their refund this year;
• For Americans who owe taxes this year, 43% stated that they will dip into savings to pay Uncle Sam.