A new nationwide survey issued by Citibank finds that although U.S. women’s expectations for the economy have declined, they remain hopeful that their personal economic situations will improve. The impact of the financial crisis and the ensuing recession have profoundly altered their financial habits, in ways large and small. Witness the proliferation of savings blogs like The Recessionista. Most interesting, the findings show that thrift really is the new chic. Frugality is most definitely here to stay, with 56 percent of women asserting that their spending and savings habits have changed forever. Yes we can!
This survey, conducted by Hart Research Associates, found that 71 percent of American women believe the economic downturn still has a ways to go before reaching the bottom, an eight-percentage-point increase since the start of 2011. However, a majority (61 percent) remain somewhat or very optimistic about their own personal economic situation within the next year. They also maintain a confident self-assessment of their track to success, with 84 percent of women considering themselves somewhat or very successful in achieving their goals in life. Their top definitions of success: being valued and respected by family and friends (55 percent) and the ability to save and plan for the future (21 percent).
So what does it mean to be fabulously frugal and live well? Well, the survey shows that being financially secure means staying healthy (44 percent), having a secure job (42 percent), avoiding debt (32 percent), and having an emergency fund (20 percent). Other things women like to feel financially secure are investing in a savings account (30 percent) and their home (24 percent) as well as being their own boss (30 percent).
When it comes to saving and spending, American women are making deep and permanent changes in their personal finances. Forty-four percent are saving and investing more, 31 percent have changed living arrangements to save money, and 24 percent have decided to postpone retirement. They’ve gotten savvier in their spending, with 77 percent using coupons, 64 percent cutting back on premium products like coffee and food for less expensive options, 41 percent shopping in bulk, and 36 percent using online offers from sites, e-mail, or Twitter. Yes, use tools like Twitter and social media coupons via Facebook and other sites to save. Bing and Google are also become good savings sources via offers and price comparisons.
To further help women get the most from their money, Linda Descano, CFA®, President and CEO of Women & Co., offers the following strategies:
· Start budgeting. Once you determine where your money is going with a budget, you can prioritize your needs and potentially identify expenses that could be eliminated.
· Commit to saving. Automatically put a set amount—no amount is too small—of every paycheck in your savings account. Immediately deposit unexpected income such as birthday checks or garage sale proceeds. Aim to accumulate enough to cover three to six months of living expenses in an “emergency fund”—and only tap that fund in a bona fide emergency.
· Watch transportation costs. Save thousands on a new car by purchasing one that’s just a year or two old and yet still has a warranty. Carefully consider whether to finance or lease it. The decision may dramatically affect your monthly expenses.
· Cut down on “luxury” spending. If you only go snowboarding or skiing twice a year, it might make more sense to rent equipment instead of buying the latest model and watching it collect dust the rest of the year. Traveling off-season and shopping during after-holiday and clearance sales also are ways to get more value for your money.
· Stay on an investment diet. Just as eating a wide variety of foods is necessary for sustaining a healthy body, selecting an assortment of investments can help you maintain a sound investment portfolio. Rebalance your 401(k), IRA, and any other investment accounts you have on a regular basis to keep it in sync with your goals, risk tolerance, and time horizon.
These are all good tips, and I thank both Women & Co and Citibank for sharing the official survey findings with us on The Recessionista.