It’s not uncommon to hear someone complain about the price of goods this year or, frankly, any other year. So, it’s consequently no surprise that 90% of consumers surveyed in the second annual Wells Fargo Money Study say they're still surprised by high prices of items like water, gas, eating out, and attending events.
But, a telling sign that inflation has run amuck in recent history is the fact that 55% of consumers have delayed some of their life plans to navigate economic conditions over the past year.
“Consumer behaviors are shifting,” said Michael Liersch, head of Advice and Planning at Wells Fargo. “The value of the dollar and what it is providing may not be as predictable anymore, which seems to be more pronounced for younger Americans.”
However, Liersch is optimistic about the fact that 83% of those surveyed want to learn new ways of thinking about money and dealing with their money.
“There is a clear social narrative surrounding the question: ‘do I, and will I, have enough?’ The fact that these questions are being asked is positive because we know the earlier that people focus on their spending, saving, and investing behaviors, the more time they have to course correct to achieve their financial goals,” he added.
The ‘Sticker Shock’ Effect
At the forefront, consumers continue to navigate higher than expected prices. Nearly all those Wells Fargo surveyed (90%) responded they feel “sticker shock” in one or more areas of common spending, like eating out or downloading a video game. Most consumers wouldn’t fare well on the game show “The Price Is Right” considering how much they missed the mark. On average, respondents underestimated the actual prices of goods between 55% to 200%.
“Spending is one of the most important factors to staying on track with your goals,” says Liersch. “I would encourage people to continue to evaluate their financial choices and align their spending with what matters most to them.”
That sounds like a bright idea to 94% of those surveyed, who said they want to align money choices with their values. Almost as many (86%), want to be more intentional and thoughtful about their spending.
According to Liersch, “these insights highlight that Americans are not just winging it. They are being extraordinarily introspective and thoughtful as they navigate their financial priorities and work toward achieving their financial goals.”
Money Secrets
Americans don’t judge their peers based on how much money they make — or, at least, they don’t like to say they do. About 9 out of 10 (87%) of Americans say it makes no difference to them how much money another person has, and nearly as many (82%) say their friends include people of different levels of wealth, conveying a kind of “class-blind" and “unpretentious” outlook on life.
But that trust does not flow both ways. More than half (56%) of those surveyed do not reveal how much money they have, and a third of them (32%) say it’s because they are trying to avoid people judging them.
Regardless of whether they keep money secrets or not, more than half of respondents (53%) said if people knew how much money they had, it would create stress.
But, if their peers aren't aware of respondents' finances, they’re likely thinking about it. Despite the non-judgmental front people put on, the results strongly suggest that Americans think about money a lot — how to get it, how to grow it, who else has it, and what they do with it.
A substantial number of those surveyed spend time thinking about how much money other people have – and wishing they could have more themselves.
Almost half (47%) responded they often feel envious of the wealth of others, and 45% say they often compare their financial situation to that of others. More than one in three (37%) admit to obsessing about getting rich, a third (34%) admire social media millionaires, and about one in four (23%) admit to sometimes overspending just to keep up with people around them.
“Americans appear comfortable with other people being authentic about their financial situation, which is encouraging to see,” Liersch says. “So now it’s time to look inwardly and overcome our own self-judgment. Let’s challenge ourselves with the following question: how can we lower focus on others and define financial success on our own terms?"
Financial Goals
Many Americans (86%) have clear financial goals, and acknowledge it's their own poor habits holding them back from achieving them.
The vast majority are optimistic about how to reach their financial goals: 87% say now is a good time to save and 65% say now is a good time to invest. Yet nearly two-thirds say they need a mental reset (61%), and the following factors are holding them back:
- Habits are not easy to change (48%)
- They focus on today rather than tomorrow (43%)
- They do not know enough about money and finance (32%)
- They have a lot of others relying on them financially (29%)
- They feel social and peer pressure (15%)
The problems Americans listed convey a lesson taught by Morgan Housel’s famous book, "The Psychology of Money," in which he wrote: “Doing well with money isn’t necessarily about what you know. It’s about how you behave. And behavior is hard to teach, even to really smart people.”
The survey also suggests a notable shift in behavior around money, finding that more Americans sought financial advice from others (36%) in 2024 than the previous year (24%). Comparing responses across generations, the desire for advice is higher with teens (54%), Gen Z adults (61%), and Millennials (46%).
“Younger generations are innovating and leading the way in so many areas. In this case they are leading in the desire to learn more about money and make informed financial decisions. And Americans are saying: Now is the time,” added Liersch.
