Most Americans don't think their finances will improve in 2019

[NEW YORK] With Washington mired in gridlock and markets flashing all sorts of warning signs, the majority of Americans expects 2019 to be a grim one for their finances, according to a new study.

Just over 55 per cent of people in the United States don't see their economic situation improving this year, a new Bankrate.com report found. That slice includes 11.7 per cent who believe their prospects will worsen and 43.7 per cent who believe it will stay about the same.

The survey was conducted from Dec 14-16 of last year, when US consumer confidence had slumped to a five-month low amid stock market volatility and fears that global economic growth would moderate in 2019. A partial government shutdown - now the longest in US history - was looming, and trade talks with China had reached a wary but unresolved truce. The data are from a sample of 1,000 nationally representative interviews of American adults 18 or older, with a margin of error of plus or minus 3 percentage points.

While Americans may not be overly optimistic about their financial future, the data shows wages on the uptick. Workers saw an average hourly wage gain of 3.2 per cent over the last year, according to the Bureau of Labor Statistics' December report. Median household income, adjusted for inflation, is also on the rise.

"There can be a disconnect with what we might see as respectable economic data and how it does or doesn't help average Americans," said Mark Hamrick, senior economic analyst at Bankrate.com.

"We continue to see some economic stress throughout a sizable cross section of society."

Nearly half (49 per cent) of those surveyed blamed political leadership in Washington for the anticipated decline in their financial fortunes, over more concrete concerns such as heightened cost of living (38 per cent) and increased debt (37 per cent).

Americans lack confidence in their government, among other institutions, Mr Hamrick said, which can influence how people perceive their personal economic prospects. The public may "disagree on policy issues between the warring tribes, but what they can agree on is, 'We sent them up there because there was a job to do', and there's a sense that job isn't being tended to," he said.

The report's outlook wasn't all bleak. Despite the student loan debt crisis and data that show young people have a lower net worth than prior generations did at the same point in their lives, millennials were decidedly more optimistic about 2019 than were older Americans.

Nearly 60 per cent of 18 to 37-year-olds surveyed expect their finances to improve this year, compared to just 35 per cent of their elders.

"They represent the most upwardly mobile aspect of society and the workforce," Mr Hamrick said. "Millennials are more focused on their careers, in part because some of them were deeply sensitised to economic distress, having come of age in the financial crisis."

BLOOMBERG