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Financial Planning > Behavioral Finance

Only 57% of Americans Feel Confident About Their Finances: Survey

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What You Need to Know

  • A Northwestern Mutual survey found that most Americans feel confident about their health and other factors.
  • However, 36% of respondents say that they lose sleep at least once a month over their financial situations.
  • Those who work with an advisor are more likely to feel confident about various aspects of their lives, the study found.

A healthy majority of Americans feel confident about various aspects of their lives, but only slightly more than half feel that way about the current state of their finances, according to research released this week by Northwestern Mutual.

Seventy-nine percent of study participants said they feel strongly or very strongly about their friendships; three-quarters feel that way about their mental and physical health; and 69% said the same about their job stability.

But only 57% said their feel strong or very strong about their finances. Thirty-six percent said financial uncertainty keeps them up at night at least once a month.

“Given the uncertainty we’ve all experienced these past few years, it makes sense that some people are feeling less confident in their financial situation right now relative to other factors in their lives,” Tim Gerend, chief distribution officer at Northwestern Mutual, said in a statement.

“Finances are just one part of people’s lives, but they can have a real impact on overall wellness — especially if they are not sure if they are making sound financial decisions.”

The findings are the latest data set from Northwestern Mutual’s 2023 Planning & Progress Study, which was conducted by The Harris Poll between Feb. 13 and March 2 among 2,740 U.S. adults.

Generational Anxiety

The study found that financial anxiety tends to follow an arc as people move through life. In general, financial uncertainty is elevated for Generation Z, peaks for millennials, begins to recede for Gen Xers and reaches its lowest levels for baby boomers and older people.

For example, of those survey respondents who said financial uncertainty makes them feel depressed at least once a month, 47% were Gen Z, 54% millennials, 39% Gen Xers and 20% boomers. Similarly for those who said they lose sleep at least once a month: 44% of Gen Z, 53% of millennials, 37% of Gen Xers and 19% of boomers.

“When we think about the trajectory of our lives, there are a lot of unknowns when people are getting started in their careers,” Gerend said. “Then, people hit significant financial milestones in their 30s and 40s, between getting married, buying a house, having children and starting to more seriously plan for their futures.”

As they age and their circumstances start to feel more settled, people are likely to feel more secure in their financial situation, especially if they have had a long-term financial plan in place, he said.

Planning for Financial Wellness

Results from the study indicate that those who work with a financial advisor and those who identify as disciplined financial planners are likelier to report greater feelings of strength about the current state of various aspects of their lives, both personal and professional.

Here’s how strongly respondents felt about aspects of their lives based on whether they work with an advisor and consider themselves disciplined or undisciplined:

Friendships: Has financial advisor: 87% / Doesn’t have financial advisor: 75% Mental health: 85% / 70% Physical health: 83% / 70% Job stability: 77% / 64% Finances: 75% / 47% Friendships: Disciplined: 85% / Undisciplined: 73% Mental health: 84% / 66% Physical health: 84% / 65% Job stability: 80% / 57% Finances: 76% / 38%

“Having a financial advisor and doing disciplined planning helps in every area of life, and at every life stage,” Gerend said. “Just like building healthy habits can lead to better physical and mental health, remaining disciplined in financial behaviors can help improve people's financial wellness.”

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