Financial optimism is higher now than it was five years ago
What Great Recession? Americans are more excited about their money now than they were before things fell apart in 2008.
Almost half — 43 percent — of Americans are feeling positive about their finances heading into the new year, a survey from New York Life says. That’s up 12 percentage points from five years ago.
The survey polled more than 1,000 Americans 30 years and older about their finances for 2017, and most are expecting great things. More than two-thirds are planning to reduce debt (up from 57 percent five years ago) and 61 percent are planning to save more this coming year, up from 50 percent in 2011.
New York Life senior VP Mark Madgett says the country’s most recent recession is all but forgotten.
“The negative effects of the Great Recession appear to be waning when it comes to Americans’ expectations and their proactive plans for financial well-being in 2017,” he says. “Despite the economic and political unsteadiness that continued in 2016, many Americans feel more secure about taking control of their finances heading into 2017. The fact that more are expressing greater confidence in being able to save more and reduce debt is good news for their financial future.”
High expectations, low execution
While the survey says that Americans are making concrete plans to reduce debt and save more money long-term, many of us don’t really have a grasp on what “long-term” is. Americans, on average, say “long-term” means 4.4 years.
“It’s very positive that many Americans plan on making long-term goals, but worrisome that Americans generally define long-term to be within the next five years,” says Madgett. “While planning for the next five years is a good idea, the realities of financial life show that long-term planning should encompass plans for the next 10, 20 and 30 years.”
What changed in five years
The survey, done last month, polled nearly 2,000 Americans. The last time this survey was taken was in 2011. While the biggest changes were to reduce debt and save more, there were other financial goals Americans set for this year, including:
- Believe family will be more financially secure and better prepared for the unexpected: 46 percent (up from 30 percent in 2011)
- Believe they will be in better financial shape for retirement: 41 percent (up from 24 percent)
- Plan to increase spending on important purchases (i.e. home improvements, appliances, professional wardrobe, etc.): 34 percent (up from 17 percent)
- Plan to seek professional help managing finances: 24 percent (up from 14 percent)
How to get money management help
As nearly one-quarter of Americans plan to look for help, there are inexpensive ways to make sure your money is in order. Since most Americans don’t have a financial plan, it’s important to find credible, safe ways to get on track.
Our solutions center offers different types of problem-solving when it comes to money: credit and debt, student loans, taxes, identity theft, bankruptcy, and so much more. There are even money management basics for you to get started with right now.