The uncertain economy may be hitting home with Americans, as they continue to lose confidence in their personal level of financial security. The COUNTRY Financial Security Index recorded its second consecutive decline, slipping .3 points in February to 68.5. The drop is due to heightened concerns about short-term finances.

To provide a historical perspective, the latest Index is nearly two points lower than it was one year ago when the COUNTRY Financial Security Index was launched. Then, it registered its highest reading to date of 70.2.

The latest reading reveals Americans are more pessimistic about all aspects comprising their financial security, including savings and investments, debt, retirement, education funding and asset protection. However, long-term goals like retirement and saving for college have either rebounded or stabilized in recent months.

"The downward drift in Americans' perception of their finances is to be expected as the economy continues to concern us all," says Keith Brannan, vice president of Financial Security Planning. "While the current Index reading shows immediate priorities such as debt and savings are the largest concerns, it is encouraging that people are resilient when it comes to long-term goals like retirement and college funding."

Americans Grow Worrisome of Current Situation
- More than half of Americans (52 percent) currently rate their overall level of financial security as fair or poor, the largest rating since February 2007.
- One in five Americans (20 percent) is not confident they can pay all their debts as they come due, up two points since December and the highest number on record.
- Fewer people were able to set aside money for savings and investments in February (53 percent) than in December (55 percent).

Middle-Income Americans Feel the Squeeze

Those in the income range of $40,000 to $60,000 registered the largest drop in overall sentiment since December, becoming significantly more concerned about both their short and long term finances.

- Just 44 percent rate their current overall level of financial security as excellent or good, compared to 53 percent in December.
- Since December, those confident in their ability to enjoy a comfortable retirement dropped seven points to 68 percent, and those confident in their ability to fund their children's college education dropped 14 points to 48 percent.

"It is important not to overreact to negative news about the economy," adds Brannan. "Adjusting and following your financial plan can help you achieve both long-term and short-term financial goals, regardless of the state of the economy."