U.S. adults are saving more compared to previous years, finds New York Life’s latest Wealth Watch survey released today.
According to the findings, two-thirds of adults (64%) feel confident in their ability to meet their financial goals, and over half (52%) saved either the amount they wanted or more in 2023, for an average of $6,138.06. Americans had previously aimed to save an average of $7.435.57 for 2023, an increase from the $5,437 they planned to save in 2022, and far from the actual savings figure of $5,011.
New York Life points to the influence of financial strategies for the uptick in savings, noting that 63% of respondents with a plan met or exceeded their savings goals for 2023, compared to only 37% of those without an approach in place.
Moreover, adults with a financial strategy felt twice as confident in their ability to meet financial goals compared to those without a strategy (81% vs. 41%, respectively), and were also more likely to have started saving for retirement than those without (58% vs. 18%, respectively).
Over eight in 10 (83%) of those with a strategy were likelier to be prepared for a financial emergency than 43% of their peers without one. Those who reported having emergency savings (48%) set aside an average of $15,027.74.
Millennials secured most savings
Out of all age groups, Millennials saved the most with an average of $9,299.45, compared to an overall standard of $6,138.06. This was followed by Gen Zers, who saved an average of $6,440.67, Gen Xers at $5,132.20, and Baby Boomers at $4,059.72.
The youngest age cohorts were likelier to take a more proactive approach in their finances, as these generations reported strong engagement with their financial strategies, according to New York Life. This included developing a secondary income stream or seeking guidance from a financial professional compared to other generations
“Our data clearly show that having a financial strategy is a key factor in not only feeling confident about reaching one’s goals, but in actually reaching them,” said Donn Froshiesar, head of Consumer Insights at New York Life. “Gen Zers and Millennials were more likely to report reviewing their strategy on a weekly basis and seeking guidance from a financial professional in 2023 than other demographic cohorts.”
On the other hand, women and Gen Xers displayed less confidence compared to other demographics. Fifty-seven percent of women said they are certain they will reach their financial goals compared to 75% of men, while the “Sandwich Generation” reported the lowest level of financial confidence (55%), compared to Gen Zers (76%), Millennials (64%), and Baby Boomers (64%).
Retirement planning on the back burner
Despite the fact that more adults are organizing financial strategies, when it comes to retirement, only 21% of respondents said they’ve worked a retirement outlook into their overall approach.
While 74% believe they’ll be able to retire at age 64, and 62% say they are more or similarly prepared for retirement compared to their peers, only 41% reported having any retirement savings at all.
Plus, it’s uncertain whether respondents will work on prioritizing their retirement in 2024. Even as 80% of adults currently have a long-term financial goal for 2024, building their emergency funds (41%) and paying off credit card debt (32%) were the most common.
Still, focusing on day-to-day costs and avoiding monetary blows in the short-term is vital to long-term financial success, notes New York Life.
“Moving into 2024, individuals report maintaining the same long-term financial goals they were working towards entering 2023,” added Froshiesar. “It’s encouraging to see that even in a challenging economic environment, Americans are maintaining focus on saving, managing debt and building a plan for the future. This will help them weather financial shocks or unexpected expenses in the future and set them up for longer-term financial success.”
SEE ALSO:
- Retirees Face Lack of Financial Security
- AI, Wealth Management and Retirement to Grow in 2024
- How Younger Generations are Taking Advantage of HSAs
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.
