It’s no secret that financial insecurity is a growing concern among Americans, with a significant number feeling the weight of economic pressures. The findings from Northwestern Mutual’s 2024 Planning & Progress survey paint a stark picture, revealing that a third of American adults are grappling with feelings of financial instability. This figure marks an increase from the previous year and stands as the highest recorded level in over a decade.

One of the major contributors to this rising tide of financial anxiety is the ever-increasing cost of living. With more than half of respondents expressing concerns about escalating price pressures, it’s clear that many are feeling the squeeze on their wallets. Additionally, only a mere 9% reported that their household income was managing to keep pace with inflation, further exacerbating feelings of economic uncertainty. The sentiment towards the broader economy was quite pessimistic among survey participants, with over half predicting an upcoming recession this year. Although, it is noteworthy that the percentage of respondents anticipating a recession has declined from two-thirds in 2023 to 54% currently.

In a separate study conducted online by the Harris Poll between January 3-17, among 4,588 U.S. adults, shed light on the current sentiments and behaviors of investors in today’s economic landscape. It revealed that a significant portion of investors, 42%, are adopting a defensive approach with their savings and investments, as opposed to playing offense which was reported by 29% of respondents. Despite this cautiousness, 59% indicated they plan to either maintain or increase their spending levels this year.

This data highlights a nuanced perspective among investors as they navigate economic uncertainties while balancing their financial strategies. It underscores the importance of adaptability and informed decision-making in managing personal finances amidst evolving market conditions.