Who Do You Trust? US and UK Financial Consumers Grapple with the Global Economic Crisis

Location: Livonia
Author: Mike Scott
Date: Wednesday, May 13, 2009
 

More than half of United States and United Kingdom based financial services consumers say their household income has been adversely impacted by the current economic crisis, and 40 percent feel their personal financial situation is profoundly on the “wrong track,” according to a new Market Strategies International study that addresses a broad spectrum of financial services issues in both countries.

In addition, 46 percent of consumers in the U.K. and 26 percent in the U.S. no longer believe their money is safe anywhere.

As consumers react to the economic downslide, they are eating out less (65%, U.S.; 59%, U.K.), saving less money (48% U.S.; 53%, U.K), taking fewer vacations (54% U.S.; 47% U.K.) and using more discount coupons and vouchers (56% U.S.; 52% U.K.).

“Even with this reduction in discretionary spending, about half of consumers in both countries are saving less,” says Leona Foster, Market Strategies International senior vice president who managed the study. “Baby Boomers are considerably more pessimistic than Generation Y consumers.”

The study shows that large government bailouts are hurting the image of credit card issuers and investment firms, yet U.S. banks maintain a “positive to extremely positive” image with 53 percent of Americans and 38 percent of U.K. consumers.

Yet less than half of consumers who say their bank took government bailout money have a negative impression of their bank.

“So far banks seem to be doing the best among all financial institutions in terms of maintaining the ‘trust factor,’” said Mark Willard, Market Strategies International Senior Vice President.

Certificates of Deposit (CDs) and savings accounts are mentioned most often as “the safest place to invest money at this time” among 21% and 22% of U.S. consumers, while the more pessimistic U.K. consumers – nearly half say “nothing is safe” -- are favoring savings accounts (20%) and gold (12%).

“Consumer confidence amongst financial institutions remains very low in the U.K. in contrast to the U.S., said Bob Qureshi, Market Strategies International senior vice president who runs the company’s London office.

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