COVID-19 Budget? Think Again… 38% of Americans Don’t Plan a Budget at All
Quick facts on Americans and personal budgeting
- 38% of Americans have not created a personal budget in at least 10 years or have never created one
- 24% of Americans have created a new budget to deal with the COVID-19 pandemic and current economic crisis (since March 2020)
- About half (55%) of Americans are budgeting somewhat regularly (within the last 5 years) while the other half is not (45% at 5 years+)
- A personal budget can be simple, quick and help identify excesses and inefficiencies in your financial life
It’s hard to fix something you don’t look at, and it appears that many Americans are not looking at their financial picture very often. Even in tumultuous times such as now (global pandemic, economic uncertainty, et al) our survey shows that almost half of us have not created a new budget in the past five years. That could be a problem for folks because it’s tough to know what to do with your money if it’s unclear where it’s all going each month. Here’s the breakdown of our survey conducted June 22nd-25th, 2020:
38% of Americans do almost no personal budgeting
The most surprising statistic here is that 38 of folks aren’t really budgeting at all. There could be several reasons for this, such as another member of the family takes care of it, you’re on a fixed income that doesn’t change much or you have an accountant that does most of this for you. But we’d still recommend at least taking a personal look at your finances periodically just to make sure you’re not caught off guard or your financial priorities haven’t shifted. With smartphones, apps and budgeting software, it might not be as difficult as you imagine!
24% of Americans have created a new budget since the pandemic
The good news is that some Americans are taking charge of their finances during the pandemic and creating a new budget for their household given the situation at hand. Americans are spending less and spending differently, which is to be expected. The uneasiness of 2020 is the perfect excuse to give your budget another look.
It’s not surprising that Americans are starting to create or re-evaluate their budgets, as their financial status has likely significantly changed because of COVID-19. Considering unemployment is up, consumer spending is down, and the personal savings rate is at a record high, consumers are having to either find new ways to supplement their income (through government assistance or elsewhere) or determine what they want to do with their extra cash.Julie Myhre-Nunes, Personal Finance Editorial Director
Half of Americans are budgeting regularly (at least every 5 years) while the other half isn’t
Overall, about 45% of America isn’t budgeting quite enough, budgeting less than twice a decade, while the slim majority of Americans — 55% — are doing some kind of household budget on a regular basis. Perhaps this will shift toward more budgeting in America as the effects of events of 2020 sink in.
Creating a budget is the first step to making sound financial decisions
In these historically uncertain times, it’s very difficult to plan just about anything. Finances are no exception, but having intimate knowledge of your own situation will help your family make smart money decisions for the future. Here are a few tools and tips to get you started or keep your current budgeting strategy fresh:
- Budgeting apps
- Money-saving apps
- Financial calculators
- How to reach your savings goals
- Find the best savings accounts