70% of Americans Think Recession Is Coming, but Nearly Same Amount Not Prepared, Survey Finds
With inflation at a 41-year high, soaring prices everywhere and rising rates, fears of a recession are rampant. Now, a new survey finds that 70% of Americans believe a recession is coming, with 59% expecting it in the next six months.
A new MagnifyMoney survey finds that the top warning sign of an impending recession is inflation, at 88%. Additional signs include housing costs, at 61%, and rising interest rates at 56%.
The White House said on July 12 that it expected the new inflation data “to be highly elevated.”
“On Wednesday, we will have new CPI [Consumer Price Index] inflation data, and we expect the headline number, which includes gas and food, to be highly elevated, mainly because gas prices were so elevated in June,” White House Press Secretary Karine Jean-Pierre said in a press briefing. “Gas and food prices continue to be heavily impacted by the war in Ukraine.”
The survey finds that recession fears are being driven by housing and rent prices, 61%; rising interest rates, 56%; and the stock market, 55%.
In turn, the survey notes that more than two-thirds of Americans — 68% — don’t feel financially prepared for a recession. Women feel significantly more unprepared than men, 77% compared to 57%, while the percentage of baby boomers feeling financially unprepared is lower than all younger generations at 62%.
Live Updates: Financial Trends, Money News and More
In addition, the lower their income the more likely survey respondents were to say they are not prepared. Indeed, 80% of those making less than $35,000 a year said so, compared to just 38% of those making $100,000 or more a year.
There is one silver lining, however. The survey notes that Americans are also taking action to be better prepared, as 89% say they’ve taken at least one step to prepare for a possible recession.
The most popular response, the survey notes, was cutting back on spending, at 62%. Additional responses include sticking to a budget, 39%, building emergency savings, 26%, and paying down debt, 25%.
MagnifyMoney recommends additional steps to be prepared for a recession, including revisiting your budget, reducing high-interest debt, saving and creating new income streams.
More From GOBankingRates