Most consumers feel that their personal finances are getting better, says a new survey from Chase Card Services, released this week. Compared to last year, when 56 percent of those surveyed said that their financial situation was improving, this year 65 percent of consumers said that all signs point up for their financial future.
However, savings is a big concern of many Americans, with 74 percent of respondents naming having enough money in savings as their top concern, and 64 percent saying that saving for retirement is their second-biggest worry.
The annual Chase Pulse of the Consumer Survey polled over a thousand Americans over the age of 18 during the first week of August, asking them various questions about the economy in general, as well as their own financial pictures. Last year the survey was conducted over the phone, but this year it was done online by independent research company Research Now.
Savings a Big Source of Worry
Although nearly three quarters of survey respondents said that they were worried about having enough money in savings, only 36 percent of them have been socking away more savings since the recession began in 2008. Concerns about short-term budgets are taking a backseat to fears about retirement and savings, though over half of consumers try to save as much as they can on day-to-day purchases. Only 40 percent of those surveyed said they were worried about meeting their monthly credit card, rent, or mortgage payments.
Eileen Serra, CEO of Chase Card Services, said in an announcement of the survey results that “Consumers continue to need the correct financial tools and services to better manage their everyday expenses – that is a critical first step to gaining full control over their financial future.” She added that, “We’re encouraged that consumers think the economy and their personal finances are on the upswing, but there is still work to be done.”
Credit Card Savings Strategy
One way that consumers could save money is to use a cash back credit card, like the Discover More or the Citi Dividend Platinum Select (offer has expired), and choosing to put the cash back earned into savings each redemption period. Both cards give one percent cash back on all purchases, with five percent back in certain categories, like department stores, gas stations, and grocery stores, that rotate every three months.
Even just counting the one percent cash back bonus, if cardholders put monthly expenses of $2,000 on their cash back credit cards each month, that’s $20 every month – or $240 a year – that can go into savings. Add the maximum five percent back bonus each quarter (usually $75) and the annual savings possible jumps up to $540.
One thing that consumers should keep in mind when using this strategy is that if they carry a balance, any savings is likely to be canceled out by interest, unless they are enjoying a zero-percent on purchases introductory APR period. Even so, it’s important to be aware of the ongoing APR on any credit card and make sure that the savings rewards are worth any interest charges that could be accrued down the line.