Investors Putting Less in the Stock Market to Pay for Everyday Essentials
Despite wanting to invest, today’s market conditions have more than three-quarters (77%) of investors concerned about fluctuations in the market and two-thirds (66%) say they are nervous about their money, according to a new study by Wells Fargo & Company.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20221117005260/en/
How inflation is diverting investment dollars. Who's doomscrolling? (Graphic: Wells Fargo)
Investors are so nervous that two out of five (42%) admit they want to cash out of their investments, and more than one in four (29%) would cash out their IRA or 401(k) investments if they could do so without tax penalties.
Inflation is cutting into household budgets, with a quarter of Americans with money in the stock market moving investing dollars into everyday essentials like groceries, gas, and housing. One in four (25%) are putting less into the stock market because they need to budget their cash for regular household expenses.
The top five budget areas in need of cash are:
- Groceries (58%)
- Transportation and gas (47%)
- Utility bills (42%)
- Debt (39%)
- Housing (34%)
A full two-thirds of investors say they’re “doomscrolling,” or continually checking their investments on their phone when the market is going down. 27% of women respondents and 50% of men check the value of their investments multiple times per week.
Americans with money in the stock market see inflation as the biggest threat to their investments, with two-thirds (65%) saying lower inflation would make them feel more confident. More confidence would also come from interest rates declining (44%); decreased gas prices (41%); the war in Ukraine ending (35%); a shift in U.S. politics (34%); an end to U.S. labor shortages (20%); and a cure for COVID-19 (15%).
Lesen Sie auch
“Uncertainty on so many levels can cause people to focus in on their present self, or immediate needs and circumstances – and to lose focus on their future self, or more strategic priorities like retirement readiness,” said Michael Liersch, head of Advice and Planning in Wells Fargo’s Wealth & Investment Management business. “The irony is that this is the moment when we need to keep balance between our present and future selves, and potentially even dedicate more, not less, to our future selves.”