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Entries in Personal Income (4)

Friday
Mar012013

US Personal Income Falls 3.6% in January, Biggest Drop in 20 Years

Steve Cole/Getty Images(WASHINGTON) -- Americans spent more money in the beginning of this year, even as their wallets shrunk, new government figures out Friday show.

According to the latest report from the Commerce Department, consumer spending increased 0.2 percent in January.  This jump came even as personal income fell 3.6 percent that month, reflecting the expiration of the “payroll tax holiday." The plunge is the biggest in two decades and follows a spike in December.

“The large decrease in personal income in 20 years looks to be stock dividend-related whereby most companies prepaid them to avoid Obama’s tax hikes. Dividends are now taxed at 20 percent versus 15 percent last year,” said Tom di Galoma, managing director at financial services firm Navigate Advisors LLC.

Congress and President Obama had decided not to extend the payroll tax cut from 2010, allowing it to increase to 6.2 percent from 4.2 percent.  That effectively increased the Social Security contribution rate for employees and self-employed workers by $114.1 billion at an annual rate.

The increase in consumer spending contradicts reports from some retailers like Walmart, which indicated the expiration of the payroll tax holiday negatively affected sales.

Copyright 2013 ABC News Radio

Friday
Aug312012

American Consumers Went on a July Spending Spree

Jupiterimages/Thinkstock(NEW YORK) -- Consumers did more than sweat during a particularly hot July. They spent more money than they did in the past five months. In fact, the spending increased 0.4 percent, the biggest boost since February.

What accounted for this rise in spending was a drop in gas prices that peaked last April.  However, prices at the pump have steadily risen over the past month.

Personal income also ticked up slightly last month, putting more Americans in a buying mood.

Since consumer spending accounts for 70 percent of economic activity, analysts expressed mild optimism that people might be starting to feel a little better about their financial situations.

However, Wall Street was unimpressed by the numbers, with the Dow Jones Industrial average falling more than 100 points as investors await Friday's speech by Federal Reserve Chairman Ben Bernanke about possibly taking more immediate and drastic action to boost the economy.

Copyright 2012 ABC News Radio

Friday
Sep302011

Consumer Spending Rises Again in August -- But Incomes Drop

Brand X Pictures/Thinkstock(WASHINGTON) -- For a second straight month, consumer spending in the U.S. rose in August, according to a new government report released Friday.

The Commerce Department says consumer spending rose 0.2 percent -- or $22.7 billion -- last month, down from July's revised 0.7 percent increase.

The same report also shows that personal incomes dropped 0.1 percent, or $7.3 billion, in August.  The previous month, incomes grew slightly by 0.1 percent.

Copyright 2011 ABC News Radio

Monday
Mar142011

Survey: Four Out of Ten Millionaires Do Not Feel Wealthy

Adam Gault/Thinkstock(BOSTON) -- The nation's millionaires have spoken, and the magic number above which they feel wealthy is $7.5 million. Four out of 10 millionaires surveyed say they do not feel wealthy, even though they reported an average of $3.5 million in investable assets.

Among the 58 percent of responders who do feel wealthy, they said they began to feel so at $1.75 million in investable assets.

Gail Graham, an executive vice president in Fidelity Institutional Wealth, the group that conducted the survey, said the she believes different definitions of "wealthy" are can be attributed "how much retirement influences how people feel."

While their near-term confidence in the U.S. economy remains negative, their outlook is at the highest level since Fidelity began tracking millionaires' views in 2006.

Graham said the attitudes of millionaires are both a "leading indicator and a causal factor" of the direction of the economy. Representing 56 percent of the nation's wealth, she said the millionaires "have the power to make what they believe happen."

The survey of 1,011 financial decision makers in U.S. households with investable assets of at least $1 million, excluding any real estate holdings and workplace retirement accounts, was conducted online Oct. 18-29, 2010.

The average millionaire who participated in the survey is 56 years old, male, and has $3.5 million in investable assets with an annual household income of $379 thousand. The majority -- 86 percent -- have college degrees, and 46 percent hold graduate degrees.

Those surveyed represent only 5 percent of U.S. households. Sixty percent of participants were male, while 40 percent were female.

Copyright 2011 ABC News Radio







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