Saturday, November 14, 2009

American consumers getting a grip on debt

By Cara Henis

More American consumers are paying down -- and even paying off -- their debts, according to a September survey commissioned by Wells Fargo & Co. and conducted by Ipsos Marketing, a marketing research company.

The quarterly survey of more than 2,000 U.S. homeowners found that approximately 20 percent of homeowners paid off their debt completely between July and September of 2009, up from just 9 percent the previous three months. The percentage of homeowners making strides toward lowering their overall level of debt also rose dramatically, reaching 42 percent, up from 30 percent in the previous quarter.

Homeowners are also getting serious about putting money away. Twenty-seven percent of homeowners increased their savings, up by about 8 percent from the previous quarter. And even those who haven't begun saving yet are feeling the urge to do so. About 55 percent of those asked said the yearning to save is a "top influence" on their spending habits.

Despite the emphasis on savings, consumers are more willing to finance family fun and vacations than they have been in the past, the report says. Yet most are doing so while holding steadfastly to a budget.

"Don't let your eyes get bigger than your wallet," a survey participant said. "Spend only what you are reasonably sure you can afford."