One in four Americans expect to retire later than anticipated due to the financial toll of the COVID-19 pandemic, with amplified effects on people of color and lower earners, according to a survey of about 5,000 consumers.
The three-part report, conducted by the Charlotte-based LendingTree and Stash, a personal finance app, observed how the pandemic’s economic effects impacted Americans’ quality of life, finances, spending, saving and investing. The survey was conducted online in August 2020, and the results were released Monday.
LendingTree and Stash found that the expected impact of COVID-19 on a delayed retirement was greater for those who make less than $35,000 and Gen Xers — those who were born between the mid-1960s and early 1980s. The impact was also greater for Latino and Black consumers, the study found.
Additionally, the survey found that people of color reported a higher rate of financial challenges due to the pandemic, with 64 percent of Black consumers and 62 percent of Latino consumers reporting that they faced at least one struggle due to the pandemic, compared to 49 percent of white consumers who said the same thing.
“[It’s] all the more clear that there is a massive wealth gap in this country, and some populations – especially people of color and low-income individuals – are having trouble paying this month’s bills, let alone setting extra money aside,” Matt Schulz, chief credit analyst at LendingTree, said in a press release.
Schulz also said the survey showed that many consumers learned from their lack of preparation for the economic shock of the coronavirus pandemic and are now more focused on building their savings for a future emergency. Consumers have increased spending on face masks, groceries, necessities and digital entertainment subscriptions, the survey found, while decreasing spending on dining out, nightlife, travel and car rentals or purchases.
The survey found that more than 20 percent of consumers began investing for the first time during the pandemic, including 28 percent of Gen Zers, born between the late 1990s and early 2010s.
“The last few months have been ripe with paradoxes,” Mindy Yu, director of investments at Stash, said in the press release. “While some Americans seamlessly transitioned to remote work, millions of others faced unforeseen job loss. Similarly, certain groups invested their money for the very first time, while others struggled to afford everyday necessities.”
