Bankrate findings raise questions on consumer spending

Normally here at Tematica we love to get new data, but time to time we get confirming data that puts a sour taste in our mouth. New findings from Bankrate offer support for our Cash-Strapped Consumer investing theme, and it ties with something we’ve been talking about on our Cocktail Investing podcast – rising consumer debt with a Fed that has been and is poised to continue increasing interest rates. Barring a pronounced move higher in wages, which we haven’t seen, that’s a recipe for more pressure on consumer spending – a key driver of the domestic economy. We continue to question if consumers will spend those tax legislation related benefits or get their financial house in order.

 

Only 39% of Americans say they would be able to pay for a $1,000 unplanned expense, according to new report from Bankrate.

Unexpected bills aren’t uncommon. More than one-third of households had a major unplanned expense last year, the survey showed, with half of those costing at least $2,500.

Nearly one in five Americans said they would put the expense on a credit card, the report stated, which usually makes the cost even higher as you pay off the interest.

 

About the Author

Chris Versace, Chief Investment Officer
I'm the Chief Investment Officer of Tematica Research and editor of Tematica Investing newsletter. All of that capitalizes on my near 20 years in the investment industry, nearly all of it breaking down industries and recommending stocks. In that time, I've been ranked an All Star Analyst by Zacks Investment Research and my efforts in analyzing industries, companies and equities have been recognized by both Institutional Investor and Thomson Reuters’ StarMine Monitor. In my travels, I've covered cyclicals, tech and more, which gives me a different vantage point, one that uses not only an ecosystem or food chain perspective, but one that also examines demographics, economics, psychographics and more when formulating my investment views. The question I most often get is "Are you related to…."

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