Why Many of Your Prospects Are Broke

Voya Financial and Northwestern Mutual post new survey data

(Photo: Thinkstock) (Photo: Thinkstock)

Roughly three-quarters of Americans have some kind of debt, and 18% spend more than half of their monthly income paying off lenders other than home mortgage lenders.

Northwestern Mutual Life Insurance Co. has published those sobering figures about why your prospects, and some of your customers, are so broke in a summary of results from a recent online survey of 2,749 U.S. adults ages 18 and older.

(Related: Out-of-Pocket Health Costs May Shock Retirees)

About 29% of the participants said they had mortgage debt, and 27% said they had no debt.

About 19% reported having credit card bills, and 10% said they were paying off loans used to pay for education for themselves or their family members.

Many of the consumers with debt are in no position whatsoever to buy life insurance, annuities, disability insurance or long-term care insurance: 14% of the participants with debt said they expect to be in debt for the rest of their lives.

The participants said they spent about 40% of their monthly income on discretionary expenses, such as travel and entertainment, and they said they spent twice as much of their income on those discretionary expenses as they spent on health care.

Another company, Windsor, Connecticut-based Voya Financial, probed Americans' finances with a survey of 1,018 U.S. adults ages 18 and older.

About 53% said they would be less willing to give up their financial security than to give up their smartphones, cars or vacations, but 15% would be less willing to give up their smartphones than to give up their financial security, Voya found.

The percentages were similar for vacations and cars.

The percentages varied by generation.

About 20% of the participants in the baby bust generation, for example, said they valued vacations more than financial security, compared with just 13% of the members of the millennial generation.

--- Read 7 Threats to Supplemental Health in the Major Medical Storm on ThinkAdvisor.

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