‘Financial Grit’ Among Key Behaviors Overcoming Savings Vortex
The U.S. general election, inflation, and personal debt have curtailed workers from their short-term and long-term finances and savings. Yet, a new study shows that those with “financial grit”—who work with financial advisors and take advantage of financial planning benefits, can come out on top.
An annual survey out today from Goldman Sachs Asset Management, the Retirement Survey & Insights Report 2024,” finds that due to the stress of life events, 62% of workers in defined contribution (DC) plans report having less than three months of emergency savings; 61% believe they will have to delay retirement, and potentially by four years or more for 19% of them; and 38% of Baby Boomers and 50% of Gen Xers have less than $100,000 saved for retirement.
Despite having fallen in 2024, the “financial vortex” of competing priorities continues to impact 60% of working respondents who say they will need to delay retirement because of multiple monthly expenses (67%), financial hardships (61%), caring for and financially supporting family members (57%), credit card debt (55%), paying down existing loans (53%), time out of the workforce (48%), and saving for college (42%).
Unpredictable life events beyond the vortex, like having to take an early retirement or a leave an absence, can further derail finances.
However, in its survey, Goldman Sachs Asset Management notes that by adding financial planning and advice services like goal-based, personalized planning solutions, employers can achieve their workers’ retirement goals—so long as participants utilize the benefits.
“There are these whole hosts of people who need retirement planning but don’t get it,” said Chris Ceder, a senior retirement strategist at Goldman Sachs Asset Management, in a press briefing on Tuesday. “We need to stretch these assets so that they are broadly available to all.”
Below are the latest findings from Goldman Sachs Asset Management, including the different types of retirement planners, and the advantages of getting participants into a “retirement mindset.”