New Citi Survey finds Bostonians more Upbeat about Economy than Americans Nationally, although Outlook has Declined from Nine Months Ago
Third of Bostonians uncomfortable with debt; nearly quarter say debt is unmanageable
Women more confident than men with majority of household finances
Boston, Massachusetts – A new survey issued today by Citi, and conducted by Hart Research Associates, reveals that Boston residents’ outlook on the future has declined from nine months ago yet they remain more upbeat about the economy than Americans nationally.
The survey found that while Bostonians’ outlook on the future and their local economy is not as bright as nine months ago, it remains more positive than Americans nationally.
* Three in five (61 percent) Bostonians believe that local business conditions will get somewhat or much better in the next 12 months, significantly more hopeful than adults nationally, 53 percent of whom believe local business conditions will improve.
* Slightly more than half of Bostonians (54 percent) believe we have a ways to go before the economy hits bottom, compared with 62 percent nationally.
However, when it comes to the local economy and their own personal financial situation, the outlook dims.
* Today 64 percent of Boston residents are somewhat (50 percent) or very (14 percent) optimistic that their own financial situation will get better over the next 12 months. While this mirrors the national response, it is a four point decline since September.
* The percentage of Boston residents who feel the local economy is excellent or good has held relatively steady since September (29 percent vs. 28 percent nine months ago). However, the percentage of Bostonians who rate the economy as “poor” increased 10 points to 26 percent from 16 percent in September.
In addition, the majority of Boston residents believe we have not yet hit bottom and the timetable for economic recovery will be measured in years, not months.
* 54 percent of Bostonians believe we still have a ways to go before the economy hits bottom. While this has moved negatively 6 points since September, comparatively, 62 percent of Americans nationally believe the economy has not hit bottom.
* 56 percent of Bostonians believe it will be at least two or three years, if not longer, before the economy stabilizes for their household while 23 percent believe it will take four or more years before the economy stabilizes for their household.
“Bostonians’ optimism is a bright spot and it tracks with our findings in a similar survey in March that consumers in the Northeast had a more hopeful economic outlook than their counterparts nationwide,” said Ken Kavanagh, EVP, Head of Citibank’s Central and Atlantic Regions. “However, Bostonians are cautious about their own personal financial situations and their expectations about economic recovery. Although we’ve had four consecutive quarters of economic growth, national employment data remains disappointing. They may sense the recovery has lost momentum.”
Nearly a Quarter of Bostonians Say Debt is Unmanageable
The survey found that 34 percent of Bostonians report that they are very (13 percent) or somewhat (21 percent) uncomfortable with their level of debt, an increase of 6 points since September 2009. Nationally, 33 percent of Americans say they are uncomfortable with their current level of debt.
* One in four (24 percent) Bostonians says that they have at least one area of debt that constitutes a major or unmanageable problem.
* Of greatest concern is credit card debt and student loans (8 percent respectively), followed by health expenses (6 percent).
* Young Bostonians are struggling the most with debt as 28 percent of 18- to 39 -year-olds report that at least one area of debt constitutes a major or unmanageable problem, specifically student loans (13 percent) and credit cards (9 percent).
* This compares to 27 percent of 40- to 64-year-olds who cite credit card debt (10 percent), mortgage debt (8 percent) and unpaid taxes (8 percent), and 12 percent of Bostonians over age 65 who cite health expenses (7 percent).
Household CFO: Boston Women More Confident than Men
When it comes to Bostonians’ confidence in their financial literacy, the survey found that
Boston women reported feeling more confident than Boston men in almost every area.
* On household budgeting, 71 percent of women rated themselves a seven to 10 (on a zero to 10 scale) versus 66 percent of men.
* This also held true for buying a home/managing a mortgage (60 percent of women and 55 percent of men) and understanding credit history and credit score (71 percent of women and 61 percent of men).
* However, when it came to investments, just 32 percent of women rate themselves a seven or higher compared to 46 percent of men.
“Right now, Bostonian’s top financial priorities are saving for emergencies, to reduce debt and to fund retirement. It’s good to see they are exercising discipline to navigate the downturn in the near term while keeping an eye to the future,” added Kavanagh.
Citi conducted this nationwide survey as part of its ongoing effort to better understand changes in the needs of the consumers and communities the company serves.
Citi, the leading global financial services company, has approximately 200 million customer accounts and does business in more than 140 countries. Through Citicorp and Citi Holdings, Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services, and wealth management. Additional information may be found at www.citigroup.com or www.citi.com.
Hart Research Associates conducted the telephone survey of 2,005 adults nationally, including 450 adults in the Boston MSA (216 men and 234 and women), from June 22-29, 2010. The Random Digit Dialed (RDD) survey has an overall statistical margin of sampling error of plus or minus 2.19 percentage points nationally and 4.62 percentage points in the Boston MSA. The survey also included a panel of respondents who use only a mobile telephone.
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