Personal Financial Wellness

Today, the #JPMCInstitute released two new reports covering the state of household liquid balances through March of 2023, as well as trends in how consumers manage their cash buffers, defined as liquidity scaled to expenses. In addition to incorporating savings account balances into our latest edition of the Household Pulse, we also account for inflation using CPI data, and display balances by race for the first time in the series. At the end of the first quarter in 2023, balances were roughly 10 to 15 percent elevated relative to 2019—the lowest since their peaks in April 2021 following the COVID-19 stimulus. Aside from slight upticks in liquidity associated with the distribution of tax returns this spring, balances have been declining since our last release in mid-2022. Consistent with lower pre-pandemic balances, Black and Hispanic households saw the greatest relative balance gains during the pandemic following stimulus payments, but those gains depleted more quickly than for Asian and White households, and median cash balances were consistently lower. To better contextualize the current state of liquidity following the pandemic surge in savings, Household Cash Buffer Management from the Great Recession through COVID-19 analyzes cash buffer outcomes over a longer window that spans from 2008, through the pandemic, and into early 2023. The report concludes that recent declines in excess liquidity closely resemble prior patterns observed at the individual level following positive shocks to liquidity. Individuals spend down or transfer excess cash but then slow that activity as they approach their personal “normal.” Through this process, individuals gravitate towards a relatively stable personal normal cash buffer level over time. In aggregate, median cash buffers were largely stable from the Great Recession until just before the COVID-19 pandemic. Differences in cash buffers by race were similar to differences we observed among liquid balances. Black and Hispanic individuals held substantially lower cash buffer levels compared to White and Asian individuals. We also found differences in cash buffer outcomes by income. Lower-income individuals were not only more likely to see volatility in cash buffer levels, but also were nearly twice as likely to hold less than a week’s worth of spending in their buffer. We also found that cash balances return to normal levels asymmetrically, as cash buffers usually take longer to build than they do to spend down. A huge thank you to Erica Deadman and George Eckerd for their leadership on both the Household Pulse and Household Cash Buffer Management reports respectively! To read additional coverage of our work, check out the latest Washington Post article written by Abha Bhattarai: https://lnkd.in/ekmpxys6

We don’t give Gen Z enough credit! “I use UPI for everything. I don’t use credit cards. I don’t even carry cash.” That’s what I heard on one of Nikhil Kamath’s podcasts. And it took me back. Back when our parents warned, “Don’t take loans,” it came from caution. Today, when Gen Z says it, it’s strategy. According to ET Snapchat GenZ Index: - 49% don’t use any credit products - 82% say they prefer zero-debt living - 77% would rather spend within their means than borrow They’ve seen too much: - Parents juggling EMIs - Friends spiralling on BNPL - Finance creators turning “debt-free” into a flex Now it’s: - Pay first, own fully - Don’t swipe what you can’t UPI - Invest small, sleep well Call it minimalism. Call it a trauma response. Either way, it’s practical. And we don’t give Gen Z enough credit (no pun intended) This new money mindset isn’t about chasing points, it’s about owning your peace.

Gen Z has ₹254 in their bank account... but just bought a ₹300 "sweet treat" because of slightly bad day at work. Sound familiar? It's not about being irresponsible. It's about survival. When rent eats 40% of your income and inflation makes groceries feel like luxury shopping, that ₹300 dessert isn't indulgence—it's emotional regulation. Behavioral finance calls this "self-soothing consumption." I call it being human. And the data backs the story: - 50% of Gen Z feels financially unstable by month-end (Bank of America) - Yet spending on small luxuries continues rising - Because mental health > bank balance (at least in the short term) But here's the GOOD NEWS - you don't have to choose between now and later. Instead of restricting these moments, design your life around them: Before your next "little treat" purchase: - Set up a ₹500 weekly SIP (automate it so you never see the money) - Track your emotional spends because awareness alone can cut impulsive purchases - Apply the 24-hour rule for purchases The goal isn't perfection. It's intention. When you're aware of why you spend, you can spend and save. Even small amounts compound—₹2,000/month invested over 10 years becomes ₹3.5 lakhs. The future of personal finance is not about restriction. It will be about integration: aligning emotional spending with long-term wealth creation. So get that Latte BUT only after you have paid your future self first! Cheers! . . #personalfinance #linkedinforcreators #moneytips #psychologyofmoney

Mental Health Awareness Month is always a reminder to pause. To check in with ourselves, breathe a little deeper, and take stock of how we’re really doing.  For many young people, that pause feels especially needed. The latest Deloitte Global Gen Z and Millennial Survey (https://deloi.tt/4bjQekS) reveals something we can’t ignore: the majority feel anxious or stressed most of the time—and for many, their job is a big factor. We’ve long talked about money, meaning, and well-being as separate things. But this generation sees the truth clearly: they’re all connected.  When they feel financially secure, they’re more likely to report strong mental health. When their mental health is solid, they’re more likely to feel their work is meaningful. And when they find purpose and value in their work, they’re more likely to feel genuinely happy. But too often, what they’re getting instead is burnout. Long hours. A lack of recognition. Feeling overlooked. While many feel comfortable talking about mental health with their managers, a quarter still worry they’ll be judged or even penalized for it. That tells us we still have work to do. As a mom to two daughters in this generation, I see how clear their expectations are. They’re not waiting for permission to talk about mental health or for workplaces to catch up. They want to be part of cultures that support growth, well-being, and purpose. This perspective benefits all of us. Because when we build environments that truly care for people, people bring their best — to work, to their communities, and to themselves. 

Financial stress is the quiet crisis hitting Gen Z and most of them were never taught how to manage money. That's what I spoke about on Seven Network. As we head into the upcoming Federal Election, one thing is clear, cost of living is front and centre. But for young people, it’s not just about rising grocery prices or rent spikes. It’s about choices being taken off the table. At the Australian School of Entrepreneurship, we’ve worked with thousands of young people across the country - from metro cities to remote communities. And here's what they're telling us: 💬 “How can I save when I barely make enough to survive?” 💬 “I want to study, but I need to work just to help my family pay bills.” 💬 “Owning a home feels impossible. Even affording my first car feels far off.” So what’s the solution? Here's A solution. We need to stop assuming financial literacy is a ‘nice-to-have’. It’s a must-have. Financial literacy isn’t just about knowing how to budget. It’s about building the confidence and capability to make smart, sustainable choices, now and for the long term. 🧠 Research shows that young people with strong financial literacy are more likely to: • Save regularly • Avoid high-interest debt • Budget effectively • Plan for future expenses (ASIC, 2022) 1 in 2 young Australians aged 18 to 24 experience financial stress weekly and the majority say they were never taught money skills in school (ANZ Financial Wellbeing Survey) When young people don’t understand money, they’re more vulnerable to rising costs, debt traps and mental health pressures. But when they do understand, they feel in control - even in uncertain times. That’s why we believe real-world financial education must be front and centre in any plan to tackle cost of living - not later, but now. We need policies that don’t just talk about young people, but are built with them. Let's actually support the young people of this country. #innovation #entrepreneurship #genz

‼️ Why Gen Z’s Mental Health Crisis Demands Our Attention 90% of Gen Z feel stressed. 88% feel lonely. 89% feel lost. 36% have experienced suicidal thoughts. 💔 These aren’t just numbers—they’re a wake-up call. Gen Z is growing up in a world of immense pressure, from academic and social expectations to global crises and the relentless impact of social media. 📱 Yet when they speak up, they’re often labeled as weak or entitled. This stigma only deepens their struggles. How can we shift this narrative and create environments where they thrive, not just survive? 🏆 In my latest article, I explore: ✅ The challenges Gen Z faces, including the pressures of social media, economic instability, and breaking support systems. ✅ The importance of mental health care, education reform, and meaningful mentorship. ✅ Practical steps to help Gen Z turn their concerns into impactful action—and reinforce their belief in purpose-driven solutions. Gen Z is a generation worth investing in—pragmatic idealists with the potential to lead us into a better future. 🌟🌱 How are you supporting Gen Z in navigating these challenges? Let’s discuss in the comments! 💬👇 #MentalHealth #GenZ #MentalHealthAwareness #Leadership #YouthEmpowerment #SocialMediaImpact #ClimateChange #IntergenerationalCollaboration #WorkplaceWellness #EducationReform #SocialJustice #EthicalLeadership #PurposeDriven #GenerationZ #YouthSupport #FutureOfWork XYZ at Work

There are reports from some commentators that excess COVID-19 savings have been depleted. We disagree. Yes it is true the savings rate of current income is very low. In fact, for the June 2024 quarter households only saved 0.6% of their income. Typical savings rates are 4%-6% of income. We keep a close eye on bank deposits as one of the major sources of savings. Households bank deposits are up $536 billion in five years. The chart below shows the deposit levels per household since 2015. There was a distinct kick-up in savings during COVID-19 and deposit balances haven’t dropped. Even as conditions have tightened, household deposit levels are still rising gradually. The psyche of consumers is to hold their bank balance at least steady, which means the consumer is both budget-conscious while also feeling financially secure. We have more insights on consumer savings and spending here https://lnkd.in/g3Z3sEpt

Are households really hurting? Everyday we keep hearing how bad the economy is in surveys when actual economic data says exactly the opposite. I keep hearing from many on social media about all the pain there is out there despite all time highs in stocks, record low unemployment, and rising real wages. Of course I like to refer to the hard data. The St. Louis Fed is kind enough to provide us this data. They have 3 useful data sets. One is the percent of household debt service payments as a percent of disposable income. Two, mortgage debt as a percent of disposable income and a third that combines the two. That is what we have below. I add my own "flair" to this data by taking the long term avg, that is the zero line below and calculating the differential. As you can see below, households are actually still in very good shape. In fact, households are in better shape now than they were pre-covid! After the GFC households spent a decade paying down debt (this was deflationary!). As asset prices recovered and debts were paid down, consumers recovered. You can see from the chart also that there was a small uptick from Jan 2021 to July of 2022 were there was a modest strain. But since then household balance sheets are getting firmer again. Yes, total credit card debt is higher now, but so are incomes and so are asset prices. People love to leave the latter out of the equation. As long as we are below that zero line, I'm not that worried. I do believe though over the next few years we will cross back above and as I've said before, 2025 to 2026 I think will be the beginning of the next great financial crisis. That will also co-inside with the end of the 18 year property cycle. But for now, things look pretty good. Source: https://lnkd.in/gXEPFafy #gdp #economy #debt #growth #consumer

Why are #US consumers this resilient? Below are a few ideas (not exhaustive) that come to mind… i.) Higher real wages. As prices have responded to #Fed policy, nominal #wages have been a bit more sticky. That increase in real purchasing power has exacerbated the income effect. ii.) Population growth + strong labor backdrop. Trends in migration are returning to pre-pandemic norms. At the same time, the labor market is accommodating the rise in new entrants. iii.) Debt dynamics. US household balance sheets emerged from the Covid shock in MUCH better shape relative to other economies (thanks to years of de-leveraging post-2008). Additionally, debt (mortgages) has been termed out substantially. That’s a huge safety blanket from the effects of higher rates. iv.) Inflation expectations. Indeed, it’s possible that household expectations about #inflation have disrupted the inter-temporal substitution effect of higher interest rates. For instance, given the rise in #interestrates, households should be adjusting behaviour to save now and spend later. But the rise in inflation expectations provides an offset such that households spend now instead. The UoM survey shows households now expect inflation 5-10yr to range between 2.8%-3.2% from 2.3-2.6% pre-pandemic. v.) Wealth effects. Households are incredibly long financial assets – which have been performing for some time now. Again, this isn’t exhaustive. But it does flag that the US economy is operating on another level, and adjusting just fine to higher interest rates. This is very important for projecting where the #neutralrate is for the US, what the cadence of rate cuts from the Fed looks like, and how that passes through to US assets (including the USD). And for those wondering, rate #hikes in the US have gone from tail risk to 10-15% (still not base case).

Insolvencies declined 2.7% m-o-m on a seasonally-adjusted basis (SA) in May, following a jump higher in April. While the data has been quite volatile over the past year, even on a seasonally-adjusted basis, insolvencies have been on a gradual easing trend. The consumer insolvency rate (insolvencies per 1,000 population) edged higher in May, but remains marginally lower than it was on the eve of the pandemic. (see Fig 6). However, the level of proposals (ie renegotiation of terms) is above pre-COVID levels in all provinces, while bankruptcy levels remain well below. We also note that the total levels of insolvencies in BC, Manitoba, Saskatchewan, Alberta, and Ontario are above the levels seen in 2019; all these provinces have higher-than-average levels of debt-to-disposable income (see Fig. 7). Similarly, these provinces have seen the biggest rise in insolvency rate compared to pre-Covid. Business insolvencies declined in May on a seasonally-adjusted basis, reversing most of the increase see in April (see Fig. 8). We also note that the business bankruptcies have been relatively stable in 2025, putting an end to the declining trend that was seen since the surge in January 2024, following the CEBA loan repayment deadline (Fig 9). Elevated household debt, reduced purchasing power due to the recent inflationary episode, and high interest rates have put pressure on households’ finances in recent years. Nevertheless, there have been some improvements in insolvencies over the past year, likely due to declining interest rates in the second half of 2024. The labour market’s resilience is also playing a crucial role in this, allowing borrowers to weather various shocks by adjusting their lending to mitigate the impact of higher interest rates on their regular payments. A weaker Canadian economy due to the impact of the US tariffs and the extreme uncertainty could lead to a rise in insolvencies in the coming months. Job losses are the main concern. As we have pointed out on numerous occasions, a deterioration in labour market conditions, especially job losses, and the associated decline in income would likely lead to a jump higher in insolvencies and could have some significantly negative consequences on the economy. Easing uncertainty, improving sentiment, and the resilience of the labour market suggest the economy is no longer deteriorating.