Retirement preparedness and confidence in facing debt are two factors influencing Americans’ improved feelings about their personal finances this year.
The COUNTRY Financial Security Index also found the number of Americans who feel prepared to live a comfortable life in retirement increased slightly from last year, as 60 percent of Americans believe they are somewhat or very likely to have enough money in retirement. This compares to 58 percent in 2017.
Meanwhile, confidence in addressing debt has remained consistent since last year: half (51 percent) of Americans are very confident that they can pay their debts in time, while another 27 percent are somewhat confident. Just 14 percent are not very or not at all confident.
Overall, the survey found that 56 percent of Americans describe their financial security as excellent or good—an eight percent increase from the 48 percent of people who responded the same way last year.
Millennials’ Improved Saving Habits
While the uptick in financial attitudes over the past year has been consistent across most demographic groups, the largest jump in attitudes interestingly came from younger Americans, ages 18 to 34. This age category saw a 12 percent increase (from 37 to 49 percent) in the number of people rating their financial health as excellent/good versus fair/poor over the last year.
This age group also showed the most year-over-year increase in saving behaviors. The number of millennials claiming to have put aside money for savings and investments over the past two months rose from 47 percent in 2017 to 55 percent in 2018 – comparable to the 56 percent of Americans overall who answered the same way.
Confidence in Coverage
The majority of Americans (65 percent) are confident that their family would be able to live comfortably if they were to become disabled or die today. Unsurprisingly, Americans with higher incomes and 401Ks are more likely to feel confident that their family would be comfortable without their financial support.
In addition, close to eight-in-ten (78 percent) of Americans are somewhat or very confident that their possessions, such as their car or home, are adequately insured if they were damaged or destroyed.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
