Many Americans are postponing at least one major life event because of the coronavirus pandemic, according to a new Bankrate survey. Fully 39 percent of respondents say they’ve delayed buying or leasing a car, buying a home, getting married, having a child or taking another significant step.
When the U.S. economy plunged into recession last spring, unemployment spiked and economic uncertainty took hold. The economy has recovered dramatically, thanks to trillions of dollars of federal stimulus and the quick development of COVID-19 vaccines. But not all Americans are prospering, and the pandemic’s disruptions spurred many individual decisions to postpone financial milestones.
“Most, if not all, of us have had to delay or sacrifice some financial activity, spending or milestone during the pandemic,” says Mark Hamrick, Bankrate senior economic analyst. “How quickly we rebound depends on some combination of how or whether we were prepared for the unexpected downturn when it began, how we managed during it and how quickly we get back to a resumption of activities previously taken for granted.”
- 39 percent of Americans have put off a financial milestone.
- More than half of homebuyers who delayed real estate purchases anticipate waiting nine months or longer.
- Many who postponed car purchases also expect significant waits.
- Delays in key financial events are most pronounced among younger Americans.
39 percent of Americans have put off a financial milestone
The coronavirus pandemic created a K-shaped recovery, one in which white-collar workers continued to work remotely, and owners of stocks and real estate enjoyed booming asset values. However, employment for leisure and hospitality workers plummeted.
Reflecting that mixed economic bag, 39 percent of respondents to Bankrate’s survey said they have put off at least one financial milestone.
Buying a car was the most-cited decision subject to delay. With fewer people commuting or taking road trips, 13 percent of respondents said they’ve put off car shopping.
Homebuying also took a hit. Some 12 percent of respondents say they delayed buying a house, relieving some of the pressure on a booming housing market characterized by a sharp shortage of inventory.
And 11 percent of respondents said they put off job hunting. With unemployment still elevated in some sectors, a subset of Americans aren’t pursuing career advancement at the moment.
Bankrate conducted a similar survey in June and found that 36 percent of Americans had delayed a financial milestone.
More than half of homebuyers who delayed real estate purchases anticipate waiting nine months or longer
Respondents who have postponed homebuying predict long delays. Some 39 percent said they’ll hold off until 2022 or later, and an additional 14 percent said their plans are on pause indefinitely.
By age group, homebuying delays are expected by 18 percent of those ages 18 to 34, 15 percent of Americans 35 to 54 and just 5 percent of those 55 and older.
Many who postponed car purchases also expect significant waits
Among respondents who said they’re delaying auto shopping, the postponements could prove lengthy. Some 30 percent said they’ll delay until 2022 or later, and 12 percent said their plans are on hold indefinitely.
By age groups, postponing vehicle-buying is expected by 16 percent of those ages 18 to 34, 14 percent of Americans 35 to 54 and 9 percent of those 55 and older.
Delays are more pronounced among younger Americans
Bankrate’s survey found little difference by respondents’ race, income or geography. But a notable age gap emerged.
Younger Americans are far more likely to report that they postponed a major life event. Among respondents ages 18 to 34, 59 percent had delayed a milestone. That fell to 40 percent among respondents ages 35 to 54. Just 23 percent of respondents ages 55 and older had put off a purchase or other milestone.
The postponed milestones most commonly cited by younger Americans were pursuing career advancement, mentioned by 21 percent, and furthering education, noted by 19 percent of respondents.
How to navigate your finances in uncertain times
The economic outlook has brightened considerably in recent months, but the U.S. economy remains on shaky footing. Here’s what you can do to prepare your finances for the next crisis:
- Make a plan. Get your financial life in shape. Determine how much you’ll spend, how much you’ll save and how you’ll tackle high-interest debt.
- Build a rainy-day fund. You’ll sleep better once you’ve amassed an emergency fund equal to about six months’ of your expenses. Stash the cash in a liquid and accessible vehicle, such as a high-yield savings account. Shop around for the best rate, and for an account that fits your needs.
- Consider refinancing debt. Mortgage rates have risen from record lows, but millions of homeowners still could shave hundreds of dollars from monthly payments by refinancing. If you’re carrying high-cost credit card debt, a balance transfer card may be right for you.
Bankrate commissioned YouGov Plc to conduct the survey. Total sample size was 2,442 adults. YouGov collected responses March 10-12, 2021. The survey was conducted online. The figures have been weighted and are representative of all U.S. adults.