Financial Security Index ticks up in new year
New year, new outlook? It seems saying goodbye to 2012 may have had a positive impact on our respondents this month. Bankrate's Financial Security Index for January jumped three points, to 98.6, following a deal on Capitol Hill to avert the "fiscal cliff." Granted, this still doesn't put Americans in that positive territory where we feel better about our financial security overall (a reading of more than 100), but it is a slight uptick from the downslide we had been making since the October 2012 reading of 99.2.
Bankrate's Financial Security Index gauges how Americans feel today versus a year ago on vital financial matters. An index value of less than 100 indicates declining levels of financial security; a value greater than 100 reveals higher levels of security compared to 12 months ago.
As we all start fresh and are still feeling good about our New Year's resolutions, it seems our feelings of job security, our comfort level with debt, our feelings of net worth and our feelings about our overall financial situation matched that sentiment, all increasing over last month.
Feelings of job security and net worth also improved compared to one year ago.
The one area of the index that remains a sore spot is savings, with more than one-third of Americans feeling less comfortable with their savings now compared to 12 months ago. Just 13 percent feel more comfortable with their savings. This disparity is evident across all age and income brackets.
This could be in part due to all the spending that was done in December for the holidays, which may have depleted savings accounts a little more than some people expected. We took a look at holiday spending in our monthly "wild card" question, and it seems 28 percent of Americans spent less than they'd expected this holiday season, while just 16 percent spent more.
Maybe with the freshness of the new year we will all get a chance to boost our savings and those corresponding numbers in Bankrate's Financial Security Index as the year goes on.