First Tech Federal Credit Union Finds People in Tech Carry 45% Less Credit Card Debt than Members in Other Industries
Leader in banking for tech innovators releases new data on spending and savings trends
SAN JOSE, Calif. and HILLSBORO, Ore.– December 13, 2023 – This year, technology layoffs have surged past 240,000 globally, a 50% increase from 2022, but new data suggests people working in tech are managing finances more effectively, according to First Tech Federal Credit Union, the banking partner for tech innovators. The new insights are based on an analysis of First Tech’s nearly 700,000 members, including many people working in the tech industry. The data shows tech-based members have 45% less in credit card debt than their non-tech counterparts - and while credit card balances for non-tech members are up 25% year-over-year, tech-based members only saw a 4% increase in credit card balances during the same period.
“The impact of rising interest rates and the increased price of everyday goods is affecting everyone, which is why we remain committed to helping our members navigate their personal finances during these turbulent times, including how to manage spending and saving most effectively,” said Matt Hicks, Vice President of Deposit Products at First Tech. “Because we are a member-owned and not for profit institution, First Tech is able to offer higher rates and lower fees to members - as well as serve as a go-to resource for supporting tech companies and their employees to ensure they are maximizing their financial wellness today and in the future.”
First Tech data finds that overall, average checking account balances have decreased nearly 20% year-over-year, with savings account balances dropping more than 19% since 2022. However, tech members show healthier balances, with 167% more in their checking accounts than non-tech members, with an average balance of over $16,548. They are also saving more than non-tech members, with 247% more in their savings accounts.
In an effort to help everyone better manage their finances, First Tech is also releasing insights into what everyone should know about managing money:
Create your spending plan.
- Track your money coming in: List your paychecks, tips, loans, scholarships, everything.
- Track money going out: List all the bills: housing, groceries, utilities, credit cards, we know...it’s a whole thing.
- Add. Evaluate. Adjust. Do the math and take a look at how those totals compare. Maybe you’re in a great spot, maybe you’re looking to save more. If so, here are some budgeting tips:
- Use a savings calculator: Use our savings calculator to help you quickly determine what you could save by making cuts to your budget.
- Don’t spend more when you make more: If you get a raise, consider saving part of it or contributing more to a workplace 401(k) retirement plan.
- Get after that debt: If you have a growing unpaid balance on your credit cards, part of your budget should aim at bringing the balance to zero. Use our credit card interest calculator to determine how quickly you can pay it off and how much you can save by paying it early.
Be smart with savings.
- Your savings rate: Your savings rate is the money you save each month, expressed as a percentage of your total or gross income. Many finance experts suggest a rate of 15%. That number might move up based on your goals, but it’s a good rule of thumb. Here are three ways to boost your savings rate:
- Cut back on spending: It’s nobody’s favorite thing but look over your budget for big and small cuts you can make—every dollar you cut from spending means more put toward saving.
- Raise your income: Sounds like a no-brainer, but making more money is a great way to save money. Consider adding a side hustle, going for a new job, or negotiating a raise.
- Always pay yourself first: Set up an automatic transfer to move money into your savings right after each pay period to ensure your savings goal gets funded first.
First Tech offers a full range of customized products and services tailored for the tech community, as well as individual tools for financial wellness, including in-person banking, online and mobile banking, mortgages, loans, and an investment division. First Tech has partnerships with leaders in tech, such as Google, Amazon, HP Inc., Microsoft, Agilent, Intel, Cisco, Nike, Intuit, and more. For more information, as well as additional resources, visit firsttechfed.com.
About First Tech Federal Credit Union
First Tech Federal Credit Union is the banking partner for tech innovators. As the largest national credit union founded by and for the people of tech, First Tech understands the unique financial needs of their community and tailors services and solutions for them, including in-person banking, online and mobile banking, mortgages, loans, an investment division, and more. Because First Tech is member-owned, it puts people over profits, with competitive rates and lower fees that provide members with the roadmap they need for future financial success. Founded more than 70 years ago, First Tech has over $17 billion in assets and serves employees of cutting-edge companies like Microsoft, Intel, Cisco, Amazon, Nike, and Google through its dozens of branch locations, and more than 5,600 Co-Op Shared Branch locations across the U.S. First Tech is federally insured by the NCUA and is an Equal Housing Lender. For more information, visit www.firsttechfed.com.
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