The majority of Americans regardless of income level are worried about the affordability of everyday living items and are planning to change their financial habits this year to alleviate stress and feel more in control of their financial security.
This is according to a new survey by financial services organization Equitable. Eighty percent of the 1,000 American consumers surveyed indicated they are worried about the cost of everyday items, and half said they plan to change their habits as a result.
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The majority of respondents plan to increase how much they save each month, with 40% saying they would like to increase their savings by $500 or more. Among mass affluent respondents who have an income above $90,000 per year, nearly 70% plan to increase their savings by $500 or more per month, the survey found. Nearly half of survey respondents said they will look for ways to increase their household income and cut spending this year.
Inflation was cited as the most common obstacle to achieving financial goals, a consistent finding of the survey over the past four quarters despite inflation dropping significantly from its 40-year peak in 2022. About 60% of survey respondents view the economy as highly volatile.
“It’s encouraging to see so many people aiming to improve their financial habits,” said Equitable President Nick Lane. “Yet, with concerns about affordability, inflation and the economy still weighing heavily on many Americans, transforming those intentions into actions can feel daunting.This is where a financial professional can help by offering guidance to navigate today’s ever-changing and uncertain landscape.”
Some Americans are also rethinking their retirement goals, said the study. Lifetime income was rated highly valuable by 88% of survey respondents, although less than half were confident they understand annuities, which are a primary vehicle of lifetime income.
The study noted this interest in lifetime income products coincides with a historic transfer of wealth as baby boomers hit peak retirement age this year. More than $30 trillion in assets is expected to change hands by the end of the decade, said Equitable. Eighty percent of respondents to a separate Equitable study said they plan to work with a financial advisor to help manage their new wealth.
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