68% of Middle-Income Americans Say They're on the Path to Financial Success

Optimism can be an effective tool for staying focused on a long-term goal. A 2019 study found that optimists were more likely to experience better financial health than pessimists and had better money habits.

Perhaps that's where the optimism is coming from in the latest survey from Santander, a financial services company. The survey found that 68% of middle-income Americans -- defined as a median household income of $70,800 -- believe they're on the right track to financial success.

This rosy outlook comes at the same time that inflation remains elevated and the most significant consumer expenses -- houses and cars -- have seen substantial price increases over the past few years. A closer look at the survey shows that while optimistic, middle-income Americans worry about how inflation impacts their personal finances.

Long-term optimism amid rising inflation

While nearly two-thirds of middle-income Americans think they are on the road to financial success, more than half of the survey respondents -- 57% -- said that inflation is their primary obstacle to financial prosperity.

Not only is inflation the top concern among middle-income Americans, but the competition isn't even close. The survey showed that just 17% of respondents said slow wage growth was their primary concern.

Unspurpsingy, middle-income Americans have changed some of their personal financial strategies to cope with inflation. More than three-quarters of survey respondents -- 76% -- said inflation has affected their current financial condition, and 73% say they've been unable to save as much money because of it.

Still, optimism prevailed. Santander's data said that 79% of respondents believe they can become financially prosperous within the next 10 years.

Credit card debt just surpassed $1 trillion

While the Santander survey shows just how optimistic some people are about their financial future, other indicators show that the effects of high inflation may not go away anytime soon.

America's increasing dependence on credit cards is proof of this. Consumers' total credit card debt recently exceeded $1 trillion, according to the Federal Reserve Bank of New York, indicating that Americans need extra financial help right now. I personally took a closer look at my credit card balance recently, and I've made some changes to how I use them.

And the balances Americans are carrying right now may be difficult to bring down. Interest rates are elevated across mortgages, auto loans, and credit cards, meaning that it's more expensive to pay down debt than it's been in recent years.

How to get back on the right financial path

If you're like many Americans who are optimistic about their financial future but need extra help getting back on track, you can take a few simple steps.

First, you may want to consider a balance transfer card if your current credit card interest rate is too high. Switching to a card with a lower interest rate could help lower your monthly payments as you work to pay off your debt.

Second, you may want to consider a debt consolidation loan if you have multiple credit cards with large balances or a significant amount of debt you need to pay down. These types of loans can help you by offering a lower interest rate than a credit card will and combining all of your debt into one monthly payment.

And finally, set up a long-term strategy for paying your debt off. One good way to do this is through the debt snowball method. With this debt payoff system, you focus on paying off your lowest balance first.

For example, if you have a credit card with $500, another with $3,000, and a third with $7,000, you pay as much as you can toward the $500 card every month and make minimum monthly payments on the others. When the $500 balance is paid off, you take the amount you were paying toward the paid-off card and apply it to the $3,000 card. Once that's paid off, you move on to the card with the largest balance.

While this method may not save you the most money over the long term since you ignore interest rates and focus on the balances, many people use it because they find it easier to stay motivated by starting with small, more achievable goals.

Think positive but take action

It's great to be optimistic about your financial future, but taking steps that will move you closer to your goals is even better. And if you need additional debt-payoff strategies, take a look at some of these debt payoff apps, which can help you set up a solid repayment plan.