When an investor considers the fate of his household’s finances, he or she can complete the task with a feeling of satisfaction or dread. In August, investors were pleased with the way things are going, especially among Millionaires.
The Spectrem Household Outlook, which is designed to measure an investor’s optimism about four financial components in their daily lives, came in at 27.90 for August, its highest mark in five months. Continuing high marks for the American stock market, plus employment statistics and other positive economic indicators, spurred wealthy investors to look positively at the way household finances are headed.
The last time the Spectrem household Outlook was this high was in March, which itself marked the tail end of a six-month span of optimism among American investors. Since then, the Outlook has hovered between 23-26 but bottomed out at 22.70 in July, the lowest ranking since June of 2017.
Among Millionaires, the Outlook jumped from 25.40 to 34.88, the highest rating among Millionaires since January. Among non-Millionaires, the Outlook was at 20.45, essentially flat from July.
Among the four components which make up the Outlook, the greatest improvement was about the Economy, which is regularly the most volatile standard. Overall, the rating for the Economy rose to 23.20 from 8.40, and jumped 17 points among Millionaires and more than 12 points among non-Millionaires.
Here is a look at the outlook regarding each component:
23.20, up almost 15 points from 8.40 in July of 2018
- Economic numbers have been solid for many months, and the economy has been on a general uptick for years, but in August investors decided the economic numbers were for real. The jump of 14.8 points is the largest increase the Outlook on the Economy has had since January, went it climbed to 43.60. Generally, all segments of investors reported an improved Outlook on the Economy, led by Millionaires, investors who are still in the workplace, and female investors.
- Here is an indication of how political beliefs affect the Outlook. Among investors who lean Democratic, the Outlook for the Economy jumped more than 20 points, but landed at -16.90 (from -37.14). Among Republicans, the Outlook for the Economy is at 53.54, a 4-point increase. Even investors with claim to be Independent voters jumped in, increasing their overall rating on the Economy to 23.68 from -5.56 in July.
52.80, up from 48.13 in July of 2018
- The small increase in the Outlook for Household Assets can be seen as a reflection of the stock market’s constant climb. Millionaires reported a 14-point increase to 64.34, and non-retired investors placed their Outlook at 69.77, a climb of more than 17 points.
- Retired investors, however, placed their rating on Household Assets lower, at 34.78, a drop of 7 points. While Millionaires raised their Outlook for Assets by 14 points, non-Millionaires dropped theirs by more than 2 points.
21.60, an increase of almost 3 points from 18.80 in June of 2018.
- The only factor to see an increase, Household Income rose for both Millionaires and non-Millionaires, and was up five points for the non-Millionaire segments.
- Male investors reported the highest increase in their Outlook for Household Income, a seven-point increase to the highest level since March. Working investors, however, reported an almost five-point drop in Outlook over Income in July.
13.60, down 1.6 points from 15.20 in July of 2018
- The Outlook on Company Health often runs counter to the Outlook for both Assets and Income. The decrease came from non-Millionaires, which dropped their Outlook for Company Health from 12.10 to 4.96. Females and investors who lean Republican also reported a lower level of optimism about Company Health in August.
©2018 Spectrem Group