Four in 10 U.S. households surveyed last fall said they were somewhat or much better off financially than they had been five years prior, according to the Federal Reserve’s 2014 Survey of Household Economics and Decisionmaking released today. Just over a quarter said they were worse off than in 2009. The numbers show an improvement from last year’s figures, when one-third said they were worse off but only three in 10 said they were better off.
Meanwhile, 65 percent of respondents said they were either “doing okay” or “living comfortably” financially, up five points from the year before, while 10 percent said they found it difficult to get by.
The survey also found that 37 percent had applied for credit in the prior 12 months — up from 31 percent the year before — and 32 percent of those households were turned down or given less credit than applied for. Another 12 percent said they put off applying for credit because they thought they would be turned down. Respondents were more optimistic in 2014 that they would be able to obtain a mortgage loan than the year before.
More than 8 in 10 respondents who rented their home said they would prefer to own a home. When asked why they don’t, 50 percent said they cannot afford a down payment, 31 percent said they would not qualify for a mortgage and 27 percent said it is cheaper to rent than own.
The survey also explored savings practices. Two-thirds of respondents said they could cover three months of expenses from savings and other sources if they lost their main source of income. Two-fifths said their spending in the previous year exceeded their income. The survey found that 31 percent of non-retired respondents reported having no retirement savings or pension, including 25 percent of those over 60.