By Mark Huffman
ConsumerAffairs.com
June 18, 2009
It's a long way from "Don't worry, be happy," but as there are signs of economic improvement, Americans' pessimism about their financial security is slowing. The latest COUNTRY Financial Security Index dipped 0.3 points to 64.6 in June, marking the smallest overall decline since October 2008.
Americans' sentiments suggest the economy may be turning a corner, researchers say. While 45 percent say their level of financial security is getting worse, this is an improvement from April when nearly half felt this way. In addition, those rating their overall financial security as excellent or good increased two points in June, to 39 percent, marking the first increase since August 2008.
"While we aren't out of the woods yet, it is uplifting that the slide continues to slow," said Keith Brannan, vice president of Financial Security Planning at COUNTRY Financial. "One of the most difficult things for us all in these tough times is maintaining our long term financial needs while making sure the essentials are covered. Now is the time to plan not only for goals that require us to save, but also for protecting what we've already achieved. If possible, review your insurance as well as your financial situation. As the economy turns, you dont want an unexpected storm or accident to derail your long-range plans by using up your available savings."
While Americans' pessimism is decreasing overall, the effects of the sluggish economy are impairing their short-term outlook. A short-term component of the COUNTRY Index registered 12 in June, a drop from 14 in April. The short-term component specifically measures Americans' sentiments about their near-term finances to provide greater insight into how Americans are feeling about their financial security.
Nearly one-quarter (24 percent) are not confident in their ability to pay their debts and more than half (52 percent) were unable to set aside money for savings or investments in June, both increases since April. This marks the greatest number of Americans unable to meet these short-term goals since the COUNTRY Index began in February 2007.
Sixty-three percent of Americans say they are confident in their ability to send their children to college, up four points from April and the largest number since October 2008.
Confidence in property insurance has steadily declined since August 2008. In June, one-in-five (19 percent) said they are not confident their house, car and possessions are adequately insured, marking the highest number on record.
It is critical to protect what you already have against an emergency or unforeseen event, especially in a tough economy, adds Brannan. Financial security is more than just savings and investments. It is also about safeguarding your home, property and income."
