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November 02, 2015 at 03:51 AM
When it comes to finances, are Americans short-sighted, or future focused?
According to a brief from The Center for Retirement Research at Boston College based on data from a FINRA Investor Education Foundation online survey of 25,509 American adults ages 25-60 that looked at a state-by-state financial capability, workers are primarily concerned about their ability to satisfy their day-to-day needs and aren’t focused on their future finances—even if their day-to-day finances are under control.
The study explores whether households of all ages and income levels are shortsighted when it comes to their finances. Individuals of all ages are clearly short-sighted, while the specific problems that trouble individuals vary by age and life stage, according to the CFRR brief. Distant needs such as retirement saving consistently take a back seat to more pressing, immediate concerns.
“Among day-to-day problems, the inability to access $2,000 is associated with much larger reductions in satisfaction at younger ages, and heavy debt burdens are related to a greater reduction at older ages,” the brief states. “Among distant problems, only not saving for college and not having medical insurance are associated with statistically significant reductions in all three age groups.” Younger workers
And younger workers see less satisfaction because they’re concerned with repaying student loans. Middle-age workers are more concerned with lacking life insurance and with having a mortgage greater than the value of their home. Workers approaching retirement age are focused on repaying student loads and also having a mortgage greater than the value of their house.
