Thursday, April 26, 2012

Despite some positive indications that the economy is beginning to rebound, a majority of consumers continue to make tough financial decisions when it comes to money and spending according to the American Consumer Council.

Some 48% of consumers surveyed by the American Consumer Council indicated they remain "cautious" about the economic recovery and are "only buying necessary items" for their home and personal use. Another 8% indicated they were pessimistic about their short-term economic future. Only 34% of those surveyed indicated they were "optimistic" about their economic position in 2012.

One positive area for consumer spending in 2012 is summer vacations. Nearly two-thirds of responding consumers – some 64% -- said they planned to take a vacation in 2012 and will spend at least three days away from home. Of those consumers who indicated that they plan to take a vacation sometime in 2012, more than 68% indicated they would be driving to their destination. Only 20% indicated they would be flying to a vacation destination. The high cost of airline tickets and add-on fees for baggage and meals were listed as the top reasons listed as to why consumers will drive.

Thomas Hinton, president of the American Consumer Council, a non-profit consumer education and advocacy organization, said, "We are rapidly approaching the mid-point for 2012 and most consumers are still guarded about their financial status and the overall economic recovery. Good paying jobs are hard to find while mortgage woes, paying student loans and the cost of groceries and gas continue to worry consumers."

Hinton pointed to the Consumer Confidence Index as one indicator that consumers remain frustrated and unwilling to make major discretionary purchases. The Conference Board Consumer Confidence Index®, which had declined slightly in March, was virtually unchanged in April. The Index now stands at 69.2 (1985=100), down slightly from 69.5 in March.

Hinton added, "Until consumers can see a brighter light at the end of the economic tunnel, we don't expect a dramatic increase in spending or a major jump in their confidence levels."

The American Consumer Council (ACC) is a non-profit consumer education and advocacy organization representing over 127,000 members across the United States. ACC is headquartered in San Diego, California and has a network of 46 state/regional consumer councils.