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Noah-Elucd Household Finances Tracker Shows How The Coronavirus Is Shaking The Foundation of Family Finances

By Noah - April 23, 2020

46% of American adults report they have either lost their job or have experienced reduced hours/salary due to economic fallout of the Coronavirus

At Noah, we believe strongly that we should be a financial partner to our clients, in good times and bad. In the last few weeks, the impact of coronavirus has led to the worst month for jobless claims in US history. With events unfolding at this rate, we knew we needed a tool to measure how the public is feeling the impact in real time. 

In partnership with technology firm Elucd, we decided to make our internal “Household Finances Tracker” public. The goal of the survey is to track the fundamental financial questions facing homeowners and renters in America. We’re publishing our findings today, and plan to update every two weeks. 

The crisis is having a huge impact

Our survey results are sobering: 46% of American households report that they have either lost their jobs entirely (26%) or have experienced a reduction in hours/salary (21%) because of the crisis. To bring this to a pocket-book level: more than 15% say they won’t be able to pay their rent or mortgage in May, and nearly 30% say they can only do so by tapping savings. 

This is a moment when the financial industry as a whole needs to step up and work to support our customers. We need to get creative and utilize technology to help customers access funds quickly so that we can help them weather the coming storm. 

Renters are bearing the brunt 

As grim as the numbers are for the general population, as you dive into the numbers you begin to see that the financial impact of the crisis is hitting renters the hardest. The majority (54%) of renters say they have lost their job or seen a reduction in hours/income. For homeowners, the stat is significantly lower: 34%. This likely reflects the relative affluence of homeowners, and is a statistic we will be watching closely as this crisis evolves.

The financial choices - tightening belts

Unsurprisingly, homeowners are prioritizing their mortgage payments and rent over everything else. 68% of respondents have reported they have cut back on spending on food and other essentials. Almost 30% of the population surveyed has skipped or plan on skipping a payment on a credit card, car loan or other debt. A further 5.9% have tapped retirement savings or their children’s college savings. 9% of owners have taken advantage or plan to take advantage of mortgage forbearance programs. In other words, millions of households today are scrambling to ensure they can stay in their home.

Looking for other financial options

Coming into this crisis, Americans held 19 trillion dollars worth of home equity, even as many homeowners saw incomes that weren’t keeping up with the cost of living. Yet, our survey shows the percentage of individuals who have attempted to tap this asset during COVID-19 is less than 4%. Home equity alone won’t work to solve all of the financial pain that homeowners are in. But if ever there was a time to mobilize every asset, it’s now. The financial sector as a whole has an obligation to think creatively to help consumers utilize their assets to pay their bills during this time of crisis. 

Methodology

Elucd delivers surveys via geo-targeted online digital ads. Based on U.S. Census data, the sample is weighted to reflect the demographic and socioeconomic characteristics of the population being surveyed. Elucd surveys between 400-500 US residents, aged 18 and older, daily. This survey has a margin of error of +/- 4.9%.

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