Still deep in debt, but consumers are feeling a bit less stressed
If you think Americans are more uptight than ever about the state of their finances, think again. A new poll shows consumers are less stressed about credit cards, mortgages, home equity loans, car and student loans and other sources of debt.The Consumer Debt Stress Index, calculated by Ohio State's Center for Human Resource Research, fell 10 percent last month, after hitting record highs during the summer. "Reports on the economy have become more encouraging, with the retail and housing sectors showing renewed signs of life," said Lucia Dunn, professor of economics at Ohio State University and one of the leaders of the study.
"Consumers are feeling less anxious than they did, but high levels of debt stress on consumers are still troubling," Dunn said, adding that stress combined with the length of the current recession, which began in December 2007, have affected Americans' views on their well-being.
About 26 percent respondents to the September DSI sampling said debt has affected their health to some extent -- an increase of three percent since a year ago.
About 10 percent of those asked said debt has been an "extreme problem" for their family life, and six percent said it has been an extreme problem for their job performance -- both substantial increases over the same period last year.
The survey found women were more affected by debt stress than men, with women's debt stress about 34 percent higher than men, with the same level of debt to income.
Debt stress has been on the rise since the fall of 2007 when the DSI rose above the 100 mark, a benchmark number established in January 2006, two months after the center first began conducting the survey. The index hit 155.3 in July of this year -- 55 percent higher than the debt stress levels on consumers in January 2006 and the highest it has been since the index's inception.
The stress score fell to 132.8 in September following a 5-percent drop to 147.6 in August. Each month's index score is based on the past three months of interviews, with the average sample size being 658. It is based on telephone interviews of randomly selected Americans
High levels of consumer debt could imperil for the rapidly advancing holiday shopping season, Dunn said. "People may still be cautious with their spending, especially if unemployment continues to be high as has been forecast by many economists."
A recent survey by the National Retail Federation revealed consumers expect to spend 3.2 percent less on gifts and other holiday purchases than last year -- the first such cutback shoppers have signaled since 2002, Reuters reported. According to the NRF survey released last week, U.S. consumers said they will spend an average of $682.74 on holiday shopping this year, down 3.2 percent from $705.01 last year.
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Reader Comments (Page 1 of 4)
10-27-2009 @ 6:51AM
MyKisa said...
....dunno where they get these facts and numbers...but most people are making adjustments of some kind or another, then there are some who are only more upset....but nobody is just kicking back with the flow
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10-27-2009 @ 7:08AM
Larry said...
Makes you really wonder were they come up with this BS
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10-27-2009 @ 8:50AM
Pan said...
BS is the only thing they can come up with. If there is any reason for "less stress" it is that consumers are not buying. Anyone in debt now as been rendered a virtual slave and consigned to indentured servitude.
10-28-2009 @ 8:46AM
J. Skinner said...
Larry, it's not BS. This is the first time they've ever been faced with a problem like this and we have always had a consumer driven economy, but now the consumers are going away.
10-27-2009 @ 7:50AM
MARK said...
WHERE DID THEY GET THESE NUMBERS? I HAVE ONLY SEEN THINGS GET MUCH WORSE FOR MYSELF AND ALL MY NEIGHBORS . MAYBE PEOPLES STRESS LEVELS HAVE HIT AN ALL TIME HIGH THAT THEY ARE NOW NUMB, AND THESE SO CALLED POLLS ONLY SERVE ONE PURPOSE. START THE BAND AND LETS' ALL START SINGING AS THE TITANIC GOES DOWN.
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10-27-2009 @ 10:51AM
J. B. Sweet said...
Everyone continues to delever, shoppers are scarce and only kids roam the malls. People are more concerned about paying down their debt than the government who will eventually pass that on to the taxpayer. Even Peter the Great of Russia paid all his debt and didn't pass it on to future generations, go figure!
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10-27-2009 @ 8:10AM
Lisa Saunders said...
If people are less worried today about there debt it is because they have resigned themselves to the fact that the day is fast approaching in which they will no longer be able to pay! People will have to think first of necessities like keeping a roof over their heads and feeding their families. When people are in a survival mentality even the most responsible will realize that credit card debt is the least of their worries and credit scores will be meaningless! It has already become nearly impossible to get credit even for the people that have always paid their bills! Credit cards are raising interest rates so high that it has become more dangerous to have one than to risk not having one! And if no one is extending credit, then who cares about keeping a high credit score? The credit card companies have out-smarted themselves! They are losing their best customers and are making themselves obsolete in the process. Soon only rich people will have credit. The article is correct. People are less worried about their debt, because their priority now is to survive!
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10-27-2009 @ 9:19AM
lola said...
Good points Lisa; especially the fact that credit has been cut off to the middle class. I have always considered credit card interest outrageous. I use credit cards only because the law has always prohibited credit card companies from charging interest if the balance is paid in full each month. I do not, have not made charges that I can't pay off in full at the end of the month. I am of course lucky because I have not been in a situation where credit card debt was my only option (paying medical bills and such).
The bigger picture is that credit is cut off to small business putting the consumer at the mercy of monopoly control of every purchase.
10-27-2009 @ 8:27AM
gere said...
Huh? What crack whore wrote this nonsense? How much longer are we gonna allow this Obama adminiostration spin faked number like this? Its reality check time.
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10-27-2009 @ 8:12AM
Gayle Adcock said...
Consumer debt is shrinking because folks have had to close their credit cards because they couldn't afford the huge interest rate hikes. Safety nets gone. Governments have increased property taxes to offset declining home values. Less to spend for families. Gas going back up. Less to spend. Foreclosure rate still climbing, banks with bailout money showing a profit. Banks got the money, we didn't. Unemployment still going up. If we're more optimistic, it's the prozac.
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10-27-2009 @ 9:34AM
lola said...
Yes, "Prozac Nation". The obvious question is that; knowing these outrageous rate hikes will drive the credit card holder into default, why push the rates so high, they cannot be paid at all?
The banks are not so stupid as to not know that massive defaults have and will be the result. So, what is the end game?
10-27-2009 @ 8:16AM
paul cruz said...
they try to paint a better picture of the economy,but truth be told,we are in worse debt now with much higher aprs,by our helping banks,what a joke.
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10-27-2009 @ 8:18AM
garyrjas said...
I feel a lot less stressed. Things are looking up. Have a nice day.
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10-27-2009 @ 8:30AM
Lori said...
Less stress? Who in the world took this survey? More stress, more bills, gas going up yet again for no reason. Yeah, no less stress here.
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10-27-2009 @ 8:31AM
Lori said...
PS- we are having no Christmas gifts this year. No money for anything like that. Bills get paid as they can. I'm just thankful when they are only 2-3 weeks late. Nothing left for anything else. Yeah, lot less stress. Idiots.
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10-27-2009 @ 8:52AM
Wanda said...
You have got to be kidding me!!!!!!!!!! Who in the world comes up with these numbers???? For us who are UNEMPLOYED with no help in sight there will be NO THANKSGIVING dinner, NO CHRISTMAS presents! Heck we are just living day to day wondering if we will have a house to still live in, food on the table, enough money left over to pay the heating bill and gas to put in the car to look for work! Wall street ask for a bailout and got it........WE CRY for help and get NOTHING!!!!!!!!!!!! Washington better wake up to what is really happening on MAIN STREET and give the people out here the help they need instead of giving our hard earned tax money to GREEDY people who could care less what happens to us!
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10-27-2009 @ 8:57AM
Pistoff said...
They must make up this CRAP! everyone I know and talk to has made adjustments and are struggling to keep ther heads above water, Still wondering if they will have a job next week! If its a ploy to make people THINK the economy is doing better, we obviously are seeing right thru this BS!
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10-27-2009 @ 8:59AM
Tackberry said...
Nobody asked Me! I'm in the worst financial shape of my life. I worry everyday about losing my job, losing my house, and my sinking credit rating. Even if the frigging property values do go up, I won't be able to refinance and consolidate my credit card debt, because I'll have such bad credit from having too much credit card debt! NOTHING has changed, it gets worse everyday. Every week I see people I know losing their jobs. Thousands of professionals are standing in line to apply for jobs that pay almost nothing, because they have no choice. Things are better?Utter BullSh*t! I can't even think about Christmas, shopping is impossible when you can't even afford food!
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10-27-2009 @ 10:14AM
JIM said...
Don't give a new mortgage. Find out who/whom owns your mortgage at the county tax office. If this is NOT the company listed at the county, ask them who they sold the mortgage to and when. If the county listed mortggae holder is NOT who/whom you are paying, you may want to get a real estate attorney and file for a release of lien as your mortgage was probably sold into a mortgage backed security (MBS). These are the same financial instruments that AIG had to pay the insurance for defaulting. If an insurer paid the REAL owner of your mortgage, either th Federal Government now owns the mortgage as Gov't owns 80% of AIG or another insurance company owns the mortgage. Do not go to a foreclosure alone as the mortgage attorneys will run over you.
10-27-2009 @ 9:03AM
Pam said...
I would like to know what planet these people are living on because it sure isn't earth! Deep in debt and less stress is an oxymoron. People are losing their jobs, losing their homes, and these "polls" are claiming that they're not stressed. Unless you can buy Valium over the counter, these polls are WAY out of line. I agree with Lori and Wanda. Christmas is going to be "just another day" for me since I'm unemployed and have NO disposable income for presents. WAKE UP WASHINGTON!!!! This country is in deep trouble. Oh yea let's give BILLIONS of dollars to corporations who are doing absolutely NOTHING to help "Joe the Plumber" or the rest of us who are barely making it thru this nightmare. How bout re-routing those "billions of dollars" to the average consumer and see how fast the economy turns around? What a concept...something logical that would work...but NOT something that's going to happen.
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