Inflation is making Americans rethink their spending habits for this year's Fourth of July celebrations, according to a new survey by the National Retail Federation (NRF) conducted by Prosper Insight & Analytics. While 87% of Americans plan to celebrate the holiday, the survey highlights that rising prices are prompting many to cut back on their usual festivities.
As America celebrates its 248th birthday, more than 216 million Americans are expected to join in the festivities, spending a projected $9.4 billion on food alone. Despite this, many are feeling the pinch of increased costs in their pursuit of the American dream, with income, debt, and education all impacting their financial outlook. The survey identified cost of living expenses as the primary obstacle to financial success for many Americans.
Interestingly, the survey also found that nearly two-thirds of participants are making an effort to purchase products made in the USA, showcasing a sense of patriotism even amidst financial challenges. However, only 16% of respondents reported not being affected by inflation yet, though they expect it to impact them eventually.
Financial strains are evident, with 37% of Americans unable to save money each month and 36% specifically unable to save for retirement. Over a quarter of those surveyed reported struggling to afford everyday expenses. Rising interest rates are also a significant concern, with 74% of respondents noting their impact on the cost of living, and 59% stating that interest rates are hindering their ability to pay down debt.
The economic climate, particularly within the mortgage industry, is influencing spending decisions. Fluctuating mortgage rates and increasing home ownership costs are causing financial strain for many homeowners, leading them to cut back on non-essential spending, including holiday celebrations. The uncertainty in the housing market is also prompting both potential and current homeowners to adopt a more conservative approach to spending.
This year's Fourth of July is expected to be more subdued as Americans navigate economic challenges and prioritize financial stability. The combination of rising living costs, fluctuating mortgage rates, and overall economic uncertainty is encouraging many to opt for simpler, more cost-effective ways to celebrate Independence Day.