Americans bullish about bouncing back in 2021
But 38% say they’ll spend 2021 in 'survival mode,' focusing on the day-to-day to try to get themselves and their families through the next year.
The new year can’t come quickly enough for most Americans. Although more than two-thirds experienced a financial setback during the pandemic year of 2020, nearly three-fourths are confident that things will be better in the coming year, according to the Fidelity Investments 2021 New Year Financial Resolutions Study.
“This year’s top financial resolutions are consistent with what we’ve seen in the past,” said Stacey Watson, senior vice president with oversight for Life Event Planning at Fidelity Investments. “However, what makes 2021 unique is how people will achieve them, given the financial pressures and major life events many continue to experience throughout the pandemic.”
Sixty-five percent of Americans are considering a financial resolution for 2021, which is down marginally from last year (67 percent), but still strong given the headwinds experienced by many families.
Younger generations appear to be more committed to actively improving their finances in the new year, with 78 percent of all Gen Z and Millennial respondents considering a financial resolution compared to 59 percent of all Gen X and Boomers.
One-in-six respondents this year listed recovering from “financial losses due to the COVID-19 pandemic” as among their top financial resolutions for 2021.
When asked what motivates them to make financial resolutions, 56 percent indicated “greater peace of mind,” demonstrating the critical link between financial and emotional wellness.
Survey respondents cite three steps they would use to start the new year off right:
- Begin with a budget. Of those who said they were in a “better” financial situation this year compared to last, more than one-in-five attributed the success to budgeting better.
- Replenish the rainy-day fund. More than eighty percent of Americans say they’ll build up their emergency savings in 2021, an important money move considering that many may have tapped into their stash of cash because of financial setbacks in 2020.
- Find new sources of income. Nearly two-thirds say they plan to find new ways to make money in the new year, whether with a side hustle, selling items online or getting a part-time job.
“Americans are clearly ready to leave 2020 behind and start 2021 off on the right foot, including when it comes to their finances,” Watson said.
READ MORE: