Finance & Banking

Arvest-Backed Survey: Arkansans Paying Down Debt, Increasing Spending

Arkansans are restructuring debt, making large purchases and paying bills thanks to low gas prices and interest rates, which are putting more money in their pockets, according to an Arvest Bank-backed survey released today.

The Spring 2015 Arvest Consumer Sentiment Survey was conducted in March and focused on attitudes about spending, savings and debt in Arkansas, Missouri and Oklahoma. The last survey was completed in October 2014.

View the full report here. 

Consumer Spending

Thirty-nine percent of Arkansans said they had made a major household purchase in the past six months. This is a five-point increase over results from the October study.

Major household purchases include items such as furniture, televisions and appliances.

Respondents in Missouri, including Greater Kansas City, reported an increase from 35 percent to 39 percent in those who made major purchases in the past six months. Oklahoma was the only state reporting a drop: 38 percent to 35 percent.

“Arkansans know that this is a good time to spend,” said Kathy Deck, director of the Center for Business and Economic Research in the Sam M. Walton College of Business at the University of Arkansas and lead economist for the survey.

“Low gas prices, low interest rates and slightly higher incomes pushed the buying conditions index all the way to 131.0. Those same conditions mean that Arkansans can also pay down some existing debt or increase their personal savings rates without sacrificing too much in the short term.”

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Arkansans and Debt

Thirty-four percent of Arkansas respondents currently hold a home mortgage, compared to 31 percent in October’s survey. Only 2 percent said they plan to get a home mortgage in the next six months.

The results of those holding a home mortgage in nearby states include 42 percent in Missouri and 33 percent in Oklahoma.

Arkansas reported its largest jump in consumer credit in the student debt category, with 27 percent reporting current student debt. Only 12 percent each in Missouri and Oklahoma reported student debt in the March survey.

Thirty-seven percent of Arkansas respondents reported having credit card debt, and 30 percent reported having an auto loan.

Only 4 percent of people in Arkansas, Missouri and Oklahoma anticipated difficulty in acquiring credit in the next months. In October, the number was 6 percent for Arkansas.

Savings

In Arkansas, household savings rates decreased from 11.9 percent to 11.6 percent from October to March.

However, those planning to increase savings rose from 18 percent to 19 percent and those planning to maintain their current savings increased from 71 percent to 74 percent.

About the Survey

The Arvest Consumer Sentiment Survey is conducted by CBER, which evaluates the Arkansas data, with the University of Oklahoma’s Public Opinion Learning Laboratory. It is based on 1,200 random phone surveys.

The survey will be conducted twice a year, with the next survey results expected in November. With each study, the Consumer Sentiment Survey Index score will be released first, followed by a second release on consumer outlook including the Current Conditions Index and the Consumer Expectations Index, which are sub-indexes of the Consumer Sentiment Survey Index.

The survey, sponsored by Arvest, follows the model of the national Survey of Consumers produced by the University of Michigan. The data shows how consumers are feeling about the economy in the states where Arvest operates.

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