News of a possible double-dip recession and extreme stock market volatility prompted 40% of Americans to reduce their spending in the past 60 days, according to the September Bankrate Financial Security Index.
Although the index ticked up to 93.9, from 92.3 in August, it is still below 100, which indicates declining financial security. At 93.9, the index is at its third-lowest reading since BankRate launched the index in December 2010.
“Forty percent of Americans say they have cut back on spending in the past 60 days due to the rollercoaster stock market or concerns about the economy. That is how recessions are born,” said Greg McBridge, a senior financial analyst at Bankrate.
Even among households earning more than $75,000 a year, 37% cut back on their spending. That figure jumped to 46% for those between the ages of 50 and 64.
Only 10% of those age 50 or older feel more secure in their jobs today than they did 12 months ago, but among those under the age of 30, 23% feel more secure in their jobs than a year ago.
The index is based on a phone survey of 1,001 Americans in the first week of September.