Inflation still the top concern for consumers, with 80% of those eligible for a tax refund planning to use those funds to pay for ‘needs’ versus ‘wants’

Equitable, a leading financial services organization and principal franchise of Equitable Holdings, Inc. (NYSE: EQH), today announced new findings from a survey of more than 1,000 consumers to help uncover the latest financial trends that are top of mind for Americans.

Equitable’s survey revealed that three-quarters of consumers (75%) feel their money does not go as far as it did a year ago. Despite it being down significantly from its four-decade high in June of 2022,1 inflation is still the leading financial challenge for many today. More than twice as many survey respondents reported that inflation (39%) remained the greatest impediment to achieving their financial goals, compared to high expenses (17%), income being too low (10%) and high interest rates increasing debt payments (8%).

“We live in an uncertain world, and this undoubtedly impacts how confident we are about our financial futures,” said Nick Lane, President of Equitable. “Take for instance predictions that the Federal Reserve will lower interest rates at some point later this year. Our survey found that only one in three Americans believe that lower interest rates would significantly or moderately improve their confidence in achieving their financial goals.”

This uncertainty impacts all aspects of Americans’ financial lives, including how people balance necessities with discretionary expenses. For example, for many Americans, tax filing season can provide a one-time infusion of extra household income. However, of those who expect to receive a tax refund this year, Equitable’s survey found that eight in 10 respondents plan to allocate their tax refund towards necessities, like helping to cover living expenses (50%) or paying down debt (29%). Only 19% of respondents indicated they would use their tax refund to pay for discretionary expenses like travel or entertainment.

The survey also revealed that individuals could use help throughout the year balancing their immediate spending needs with longer-term savings goals, including financial security in retirement. Seven in 10 respondents use their checking and savings accounts to put aside funds for the future, including for retirement, instead of using more tax-efficient financial solutions with the potential for guaranteed income, such as employer-sponsored retirement plans or annuities.

Equitable’s survey also found that respondents, on average, are putting aside just $175 per month on saving for retirement. Further, more than a quarter of those surveyed (26%) indicated they have not started saving any money for retirement. In contrast, the survey found that respondents, on average, spend a total of $400 per month on the following discretionary categories: $75 on in-home streaming and entertainment; $75 on out-of-home entertainment; $75 on out-of-home dining and food takeout/delivery services; and $175 on travel.

“Financial planning can be a deeply emotional and personal subject. It isn’t always linear or rational,” said Lane. “To have realistic long-term aspirations, you must consider both a person’s ‘wants’ and ‘needs.’ Our holistic planning model goes well beyond a client’s financial wellness. We consider an individual’s sense of purpose, their physical and emotional health, in addition to their financial goals.”

About the study:

The survey was conducted by an independent, global consumer and B2B panel provider. Respondents include 1,000 U.S. adults (ages 18 and older), with the total survey population representative of U.S. demographic data. The online survey was fielded from February 23, 2024, through March 6, 2024. Survey participation was anonymous.

About Equitable:

Equitable, a principal franchise of Equitable Holdings, Inc. (NYSE: EQH), has been one of America’s leading financial services providers since 1859. With the mission to help clients secure their financial well-being, Equitable provides advice, protection and retirement strategies to individuals, families and small businesses. Equitable has more than 8,000 employees and Equitable Advisors financial professionals serves 3 million clients across the country. Please visit equitable.com for more information.

Equitable is the brand name of Equitable Holdings, Inc. and its family of companies. Reference to the 1859 founding applies specifically and exclusively to Equitable Financial Life Insurance Company (Equitable Financial) (NY, NY). Duly registered and licensed Equitable Advisors Financial Professionals offer securities through Equitable Advisors, LLC (NY, NY), member FINRA, SIPC (Equitable Financial Advisors in MI & TN) and offer annuity and insurance products through Equitable Network, LLC. (Equitable Network Insurance Agency of California, LLC; Equitable Network Insurance Agency of Utah, LLC; Equitable Network of Puerto Rico, Inc.). GE-6520061.1 (04/24) (exp.04/26).

1 U.S. Bureau of Labor Statistics, July 2022 Report

Annuity Alliance is not affiliated with Equitable. This article is for informational and educational purposes only. It should not be used to make a buying decision. If you would like to speak with a financial professional, please use Annuity Alliance’s contact form.