Financial stress is returning and affecting younger age groups like Gen Z and Millennials, according to new data from LegalShield, PPLSI's consumer brand and the leading provider of membership-based legal services and identity theft protection plans. This is a concerning trend given that many pandemic-related federal support efforts have expired, and student loan relief is set to expire in early 2022.
According to the findings of LegalShield's monthly Economic Stress Index, the gap between consumer confidence and consumer financial stress is expanding; in fact, it's one of the biggest gaps in LegalShield's 20+ years of data collection. However, the difference between Gen Z and Millennials is closing faster than it is for older generations, indicating that financial resilience will be weakened next year. The following are some key data points:
Overall, calls for collections-related assistance have been unchanged since January 2020; however, the data shows record-high assistance requests among Gen Z and Millennials.
The demand for these age groups reached an all-time high in March 2021 and stayed close to it from August to November 2021.
Billing disputes, which can be a leading indicator of economic stress, reached an all-time high in November for Gen Z and Millennials, and have stayed high throughout 2021, with November reporting the greatest level since April.
The Economic Stress Index also revealed the following major findings:
In November, the LegalShield Consumer Stress Index fell to its lowest point ever. Even as federal assistance expires, financial stress is minimal due to savings accumulated during the pandemic and a favorable work market. The Commerce Department reported that retail sales gained 1.7 percent month over month in October (above forecasts), while Visa's Spending Momentum Index surged in October as both discretionary and non-discretionary purchases increased.
In November, the LegalShield Foreclosure Index fell somewhat, but it remains historically low. While the number of foreclosures has grown after the foreclosure moratorium ended, it is still significantly below pre-pandemic levels.
The LegalShield Bankruptcy Index remained essentially steady at one of the lowest levels ever recorded in the series' history. Consumers are in strong financial shape, as they continue to spend their epidemic savings.
Following its worst-ever drop in October, the LegalShield Housing Construction Index fell again last month. While builders face challenges such as a scarcity of developed lots, labor shortages, supply chain interruptions, and high material costs, continuous demand for homes predicts that housing building will continue to thrive in the coming months.
In November, the LegalShield Housing Sales Index declined for the second month in a row. Despite the fact that limited inventories and high prices are hurting home sales, demand is projected to stay robust.
LegalShield is the nation's leading supplier of subscription-based legal coverage, tracking more than 2 million requests for legal services each year through its network of partner law firms in all 50 states. The unique data is compiled to provide real-time insight into the economic and financial health of American households and small companies. With proven accuracy, LegalShield's Economic Stress Index can identify near-term changes ahead of other indicators.
LegalShield, the world's largest platform for legal, identity, and reputation management services safeguarding individuals and organizations across North America, is a forerunner in the democratization of inexpensive access to legal advice, counsel, protection, and representation. LegalShield and its privacy management company, IDShield, have offered individuals, families, organizations, and employers with the tools and services they need to live a just and secure life on a budget since 1972. LegalShield is disrupting the traditional legal system and redefining how and where individuals receive legal advice and services by providing access to thousands of skilled, trusted attorneys and law firms using technology and innovation. Visit LegalShield.com and IDShield.com to discover more about LegalShield and IDShield's products and services.
For 49 years, PPLSI has been a champion of equitable access to justice and security, providing individuals, families, businesses, and employers with the tools and resources they need to live just and secure lives. Our consumer brand, LegalShield, is disrupting the legal services market under PPLSI by providing everyone with the resources and tools they need to achieve justice at a reasonable cost. We're changing the way people get legal advice and services by putting trained, reputable attorneys and law firms in the palm of your hand. IDShield, our security brand, focuses on privacy and reputation management while also safeguarding your online data and information. Visit PPLSI.com, LegalShield.com, and IDShield.com to discover more about PPLSI and our brands and solutions that presently benefit and empower 4.5 million individuals and 140,000 businesses across North America.