Americans continue to experience their highest levels of personal financial satisfaction despite a rising interest rate environment, according to the AICPA’s Q2 2018 Personal Financial Satisfaction Index (PFSi). Personal financial satisfaction was buoyed by a record number of job openings and a rebounded stock market. The second quarter 2018 PFSi measured 27.7, a new all-time high for the index representing a 0.7 point (2.6 percent) increase from the prior quarter. This positive reading indicates that the average American should be feeling a strong sense of financial well-being.
The Q2 2018 Personal Financial Pleasure Index measures 72.2, a 2.8 point (4.0 percent) increase over the prior quarter. This gain establishes a new all-time high for the Pleasure index. The most notable improvement is in job openings per capita which increased 5.9 points (11.0 percent) over the last quarter to 76, a new record high. Overall job openings set records in the second quarter, with almost 6.7 million openings in April. The number of job openings increased in professional and business services, trade, transportation, warehousing, utilities and several other industries. In May, the most American workers in 17 years quit their jobs, indicating strength in the job markets as more people appear confident they can find a new job elsewhere, possibly at higher pay.
“A great job market is the perfect time for Americans to shore up their emergency fund, double check they’re making the most of their work benefits, and even consider shopping around to see if there is a better financial opportunity in their field,” said Kelley Long, CPA/PFS, member of the AICPA’s Consumer Financial Education Advocates. “In these times of increased market volatility, the best thing to do is stay the course, unless you’re near retirement. If that’s the case, then now is a great time to rebalance your portfolio to ensure you have adequate cash set aside, so that when the market does inevitably take a downturn, your retirement plans aren’t affected.”
After declining last quarter for the first time since Q3 2015, the PFS 750 Market Index rebounded 4.3 points (5.2 percent) from its Q1 2018 level to 89 and has once again reached an all-time high. It remains the leading contributor to the Pleasure Index as well as the PFSi overall. This AICPA proprietary stock index is comprised of the 750 largest companies trading on the US Market adjusted for inflation and per capita. In Q2, information technology led performance, followed by consumer discretionary and health care, whereas real estate and telecom delivered losses. According to Fidelity Investments, the sturdy domestic economy bolstered US stocks in Q2, especially small caps and REITs, which are less exposed to global trends and trade risk. However, the market remained extremely volatile in the second quarter.
For reprint and licensing requests for this article, CLICK HERE.
Stories You May Also Be Interested In
- Tax Reform: Americans’ Financial Satisfaction Hits Record High
- Most Influential Minority CPAs: Business Executives’ Optimism about U.S. Economy Hits Post-Recession High for Second Consecutive Quarter, AICPA Survey Finds
- Economic Forecast & Trends 2018: Business Executives’ Optimism about U.S. Economy Hits a Post-Recession High
- 2019 Most Influential Minority CPAs: Personal Finance Trends Everyone Needs to Know
- The Business of Accounting: AICPA Survey Finds Shifting Tone in Economic Outlook
- Most Influential Women in Accounting: Expectations Rise for Profit and Revenue Growth in Coming Year
- Mid-Year Economic Forecast: Executive Outlook Holds Steady After Earlier Decline
- Mid-Year Economic Forecast: CPAs Believe Complex Financial Instruments Pose Risks