Analytical consumers earned double the interest income by leaving their bank deposits in certificates of deposit compared to impulsive consumers who liquidated.

New analysis by Money Anxiety shows that analytical consumers earned an average of $139 a year in interest income on a $10,000 certificate of deposit compared to only $62 in annual interest income earned by consumers who made an impulsive decision to move their money to liquid bank accounts such as checking, savings and money market. 

The research shows that consumers, who moved their bank deposits to liquid accounts, acted impulsively due to high level of money anxiety.   This phenomenon is defined as “mattress money” in the book Money Anxiety, when anxious consumers want to feel that their money is readily accessible to them in case of a financial emergency.  Such impulsive decisions originate in the reptilian part of the brain and are designed for survival and self preservation. 

Conversely, analytical decisions originate in the neocortex and are calculated and slower to make.  Consumers, who resisted the impulse to move bank deposits from certificate of deposit to liquid accounts at the beginning of the Great Recession, did much better financially even though interest rates on all bank deposits declined in the past six years.  By making an analytical and calculated financial decision, these consumers earned double the interest income in each of the six years since the beginning of the Great Recession.

The book Money Anxiety (www.moneyanxiety.com) shows how financial anxiety impacts consumer financial behavior and the economy. The book demonstrates how we really make our financial decisions, and reveals what truly drives our decisions to save money and to buy products and services.  Money Anxiety is available in paperback and eBook formats in all major online booksellers such as Amazon, Barnes and Noble, Google Play and iTunes store.  The book is highly beneficial to business and financial people by helping them understand how and why consumers buy.

The June preliminary* Money Anxiety Index stands at 73.9  - a slight improvement from last month indicating consumers are less financially stressed this month compared to an increase of 1.3 in the first quarter of this year. The Money Anxiety Index is down 16.5 points from the same month last year.

The occasional spikes in the Money Anxiety Index trend line point to uneasiness among consumers about financial and political events that could impact their personal finances and the economy as a whole.