There has been a change in the global financial situation since the start of the COVID pandemic. Many people have faced financial trouble, and it looks like they’ll continue dealing with the financial problems. Since the outbreak, the world has been facing price hikes, which has made it difficult for people to save up the way they used to during the pre-pandemic years. Now, it’s been reported that Americans’ savings rate is going down – and fast. The saving rate has declined to the point that it’s giving history enthusiasts a Great Recession flashback.
Just A Year Ago
According to the U.S. Bureau of Economic Analysis, the Americans’ personal savings rate was recorded to be at 4.4% in April of 2022, which is the lowest rate recorded since September of 2008. This not only shows the impact of inflation on the savings of an average American but also shows that people are now paying more for products and amenities than they were before the Pandemic.
However, in April of 2020, the saving rate was recorded to be around 33.8% and this was during the beginning of the COVID-19 lockdowns. This is 8% greater than the saving rate in February of 2020. This figure stayed in double digits till June of 2021 because of the government’s efforts and the pandemic restrictions.
A Shocking Study
In 2022, the saving rate in the United States of America was greatly struck due to inflation. This has forced people to spend more on their livelihoods compared to what they used to spend. Research has shown that an American adult saves $243 less every month, while another study revealed that Americans have 15% less in non-retirement savings right now compared to what they had a year ago. As of now, the only thing that Americans can do to counter it is to earn more money. The government has reported that wages and salaries have increased by 0.6%.
This shows the impact that inflation has on the country’s current situation and the dire financial situation of American citizens.