Consumers spending less, but ignoring debt, survey finds

While consumers are cutting back on spending, they are not reducing their debt, making a debt-free retirement that much more elusive, according to a survey released today by Securian Financial Group Inc. of St. Paul, Minn.

A full 80% of the 1,204 adults surveyed online between Feb. 6 and Feb. 23 reported they have non-mortgage debt. The percentage has not changed since Securian’s last survey was conducted in October 2007, the firm reported.

But most of the respondents reported they were cutting back on spending in a variety of ways.

A full 68% said they are cutting back on groceries, 69% said they are finding ways to reduce fuel costs and 62% said they were scaling back on dining out.

“Consumers are clutching cash and postponing debt reduction,” Kerry Geurkink, director of individual annuity marketing for Securian’s retirement unit, said in a statement.

“They are wisely adjusting their spending and borrowing, but the ultimate goal of debt-free retirement will be more difficult to achieve without a better balance between saving and debt reduction.”

Baby boomers have actually added to their debt, the survey found.

Of the respondents, 344 were identified as baby boomers. Theirs was the only age group in which a growing number reported debt since the last survey.

A full 38% reported they had $25,000 or more in debt, up from 29% in 2007.

While paying off debt was a priority among many respondents, so was having money on hand for emergencies: Those selecting saving for emergencies as a priority increased to 36%, up from 28% in the last survey.

More than half ( 54%) of respondents said paying off loans, bills and other debts was a financial priority, up from 53% in 2007.

The survey was conducted by Matthew Greenwald & Associates Inc., a Washington-based market research firm, on behalf of Securian Financial.

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