Almost a year into the pandemic, and we’re seeing American’s in pretty good shape financially. This may seem like a surprising statement given the current climate and widespread of lockdowns earlier in the year, but it’s true statistically. We know this doesn’t apply to all families in the same way, but it shows how strong the US economy is recovering from such a year year.
During this time we saw very low mortgage rates, that may have had something to do with the Fed policy, but we also saw that more and more Americans are holding onto extra cash, which is something we wouldn’t think to be true.
“Despite the surge in Covid-19 cases, economists project a 4% annualized rate of U.S. economic growth this quarter, though down from the prior period’s record gain”, according to a Bloomberg survey. The survey also showed that the pandemic has been financially challenging for working class families more than wealth ones, but they all seem to have been stockpiling cash. One reason savings and cash has remained flush could contribute to the fact that due to the pandemic, many people have not been spending on activities such as dining, leisure, and travel.
In all, it seems as though many American’s may have entered the pandemic in a strong financial position, which has helped them get through it. It’s surprising and great to see how after all this turmoil, households are still remaining strong. It’s important to take advantage of situations listed above, especially refinancing, to help lower payments and in turn pile up your cash account. If you have any questions or want to discuss your portfolio or finances, please reach out to us at info@shermanwealth.com or schedule a complimentary 30-minute meeting here.
