Wealthy investors still feel the effects of the Recession and share common financial concerns
Mortgage payments, college costs and the job market continue to worry young middle class families as the economic recovery hits a soft patch, according to the latest survey by Spectrem Group.
Nearly 60 percent of Mass Affluent investors aged 54 and younger say they worry about financing their children’s education, said Spectrem. The Chicago-area market research firm defines the Mass Affluent as having a net worth of $100,000 up to $1 million, not including primary residence.
Wealth does not insulate the group from common financial concerns. More than half worry about job security for themselves or their spouse, and 30 percent worry about being able to cover their credit card bills and mortgage payments. An increase in interest rates tops their list of concerns.
“Young affluent investors are still feeling the effects of the Recession and their confidence is shaky,” said Catherine McBreen, Spectrem’s managing director. “They want to believe that good times lie ahead, but their bank accounts and portfolios are saying otherwise.”
Spectrem’s latest surveys were conducted in a time of declining consumer confidence, falling home prices and a weak job market. The ratings agency Standard and Poor’s released data on Tuesday that confirming that the U.S. housing market has taken a double dip – bad news for the 28 percent of Americans who currently owe more than their home is worth.
Consumer confidence also took a dip, declining to 60.9 in May, down from 66 in April, according to The Conference Board Consumer Confidence Index. A level of 100 is consistent with confidence levels recorded in 1985.
“A more pessimistic outlook is the primary reason for this month’s decline in consumer confidence,” said Lynn Franco, director of the board’s consumer research center.
“Consumers are considerably more apprehensive about future business and labor market conditions as well as their income prospects. Inflation concerns, which has eased last month have picked up once again.”