Bank of America Survey Finds Consumers Adjust Spending Habits in Tough Economic Times

Survey fielded in partnership with behavioral economist Dan Ariely explores what behaviors distinguish successful savers from the rest

CHARLOTTE, N.C., May 6 -- In the face of the most difficult economic environment in decades, more than 80 percent of American consumers indicate they are more conscious of their spending habits today compared to the beginning of 2009, according to a national survey released today by Bank of America and Dan Ariely, Duke University professor of Behavioral Economics and author of Predictably Irrational.

Article continues below...

The Bank of America Consumer Purchasing and Savings Habits(1) survey found a new culture of thrifty spenders is emerging to make every dollar stretch further. Comparison shopping, seeking more advice prior to purchasing and taking advantage of discount and reward programs are some of the more notable behavioral changes that have allowed consumers to put more money into personal savings.

Behaviors Linked to Achieving Saving Goals

Consumers engaging in the following smart purchasing behaviors seem to be better able to save than they could three months ago:

* Doing more research and comparison shopping prior to making a purchase (75 percent of those saving more vs. 69 percent of those saving less)
* Seeking more advice to make sure what they buy is the best product for them (62 percent of those saving more vs. 42 percent of those saving less)
* Dining in more often (79 percent of those saving more vs. 70 percent of those saving less) and entertaining at home (67 percent of those saving more vs. 54 percent of those saving less)
* Taking advantage of their bank's online and mobile tools (e.g., eAlerts, online bill pay) to have a better handle on day-to-day finances (45 percent of those saving more vs. 37 percent of those saving less)
* Taking advantage of rewards clubs and programs with retailers (44 percent of those saving more vs. 38 percent of those saving less)
* Taking advantage of credit card rewards programs (34 percent of those savings more vs. 27 percent of those saving less)

"We're seeing consumers increasingly trying to make smarter purchasing decisions and trying to achieve their savings goals," said Dan Ariely, Duke University professor and author of Predictably Irrational. "What we also see is that consumers who are successful at saving are the ones who are taking the time to pause before they shop and leveraging the tools available to help them save. What is somewhat puzzling is that not all consumers are taking what seem to be very simple steps toward saving."

While consumers are doing what they can to curtail spending, there are many who are still finding it difficult to save extra cash. Managing day-to-day expenses and findings ways to save represent the biggest financial challenges Americans are facing in today's economy (40 percent).

Tools for the Thrifty Spender

Nine in ten Americans use discounts and promotions to assist in their shopping needs, with nearly 60 percent spending more time than ever before looking for such deals. Increasingly, consumers are turning to the Web to locate discounts and coupons (37 percent); the average consumer spends more than one hour online searching for these deals. Forty-five percent of those surveyed would likely take advantage of a centralized shopping Web site that offers routine savings for shopping at major retailers' Web sites. With the launch of the Add It Up™ program, a new, secure online shopping site that offers such an advantage, Bank of America is helping customers stretch their dollars further.

In keeping with Bank of America's commitment to helping Americans make the most of their finances, the company recently announced the launch of the Add It Up™ program. The secure online shopping Web site allows enrolled customers to earn up to 20 percent cash back on their purchases at more than 300 online retailers. Customers with a current Bank of America credit or check card who are enrolled in online banking can register for free through the Add It Up Web site at http://www.bankofamerica.com/additup. Since its inception in November 2008, Add It Up customers have earned more than $220,000 cash back.

"Managing everyday finances has become increasingly important for many Americans and, at Bank of America, we understand that consumers are looking for new, creative and efficient ways to save," said David Owen, Checking and Debit executive for Bank of America. "We are pleased to offer tools like Add It Up and Keep the Change, which allow our customers to save more while they make their everyday purchases."

Tools for the Wise Saver

The survey also confirmed that Americans are continuing to struggle with saving money. Only four in ten say they are saving more than they did three months ago, and among those who are saving less, 65 percent of respondents are putting less towards general savings accounts and 26 percent of respondents are putting less towards retirement savings accounts.

Bank of America's signature savings tool, Keep the Change, allows customers a convenient way to save while spending on everyday purchases. Keep the Change is a savings account feature tied to a customer's Bank of America check card that rounds up all purchase amounts to the nearest dollar and transfers the difference from a checking account to a savings account. Since the program launched in October 2005, Bank of America customers have accumulated more than $2.2 billion in savings. By using both Add It Up and Keep the Change, Bank of America customers can receive the combined value of spending less and saving more everyday.

Source: Bank of America