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Lack of time is hurdle to adequate financial planning

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Sixty-three percent of Americans acknowledge that their financial planning needs improvement with 24 percent attributing their inaction directly to a lack of time.

The findings are found in a recent report by Northwestern Mutual. The “2013 Planning and Progress Study” found that many Americans feel modern society and its rapid pace are clouding their ability to think clearly and focus on what is currently taking place let alone plan for their future.

Sixty-nine percent of Americans surveyed for the study reported that the pace of society makes it harder for them to stick to long-term goals. More than one-in-four people feel they are too busy to even think about long-term goals which may be one of the reasons why half of all Americans have no financial plan in place.

Generation Y (ages 25-32) are the most diligent when it comes to planning for their future, quite possibly because they have been able to witness the distress of Baby Boomers approaching retirement underprepared and with their investments ravaged by the recession. The 24 percent of Generation Y who self-indentify as highly disciplined planners is a 50 percent increase over the full sample average which stands at 16 percent. The discrepancy is even greater when they are compared only with Baby Boomers, among which just 14 percent self identify as highly disciplined.

The study asked people to identify what type of planners they are. Forty percent of respondents described themselves as “informal” planners indicating that they have a vague sense of their goals but no concrete plan in place. Nine percent of respondents said they were “nonplanners,” meaning that they had no specific goals and therefore no plans to meet those goals. One-in-three described themselves as “disciplined” indicating they have goals and a plan in place but become derailed at times due to life events. Only 16 percent of respondents stated that they were “highly disciplined,” meaning they have established goals and rarely deviate from their plans to meet them.