Despite the financial impact and uncertainty caused by the coronavirus in 2020, nearly half of Americans said they felt financially prepared for its effects, according to a new survey from Clutch, a B2B ratings and reviews platform. In contrast, 33% of Americans felt financially unprepared for the economic downturn that resulted from the pandemic.
Thirty-seven percent (37%) of Americans said they saved the same amount of money from their paychecks during the pandemic, which suggests their budgeting and spending habits weren’t directly impacted.
Only 20% of Americans are saving more than they were pre-COVID-19.
Majority of Americans Feel Comfortable Creating a Personal Budget
Nearly 60% of Americans (58%) are comfortable creating a personal budget, but only a small percentage revise their budgets throughout the year to adjust for changes in income or the economy.
In the past year, 20% of Americans created a new budget at least once a month, with millennials (34%) and baby boomers (31%) updating their budgets most often, according to Clutch’s study.
Tremaine Wills, an investment advisor at Mind Over Money, emphasized how important it is to create a budget.
“If you aren’t tracking your money and you attempt to save more, you likely end up taking the money out of your savings regularly due to expenses you haven’t accounted for,” Wills said.
Housing Is the Top Expense for Most Americans
Across different generations, Americans are spending most of their paychecks on a necessity – housing.
In June, nearly 60% of Americans (59%) spent the bulk of their paycheck on housing, which includes rent, utilities, and mortgage payments.
Outside of housing expenses, Americans were spending their income on health insurance (9%), education (6%), and vehicles such as car, insurance, or gas (8%).
Clutch’s 2020 budgeting habits study included 502 people across the U.S.