The past year has been a financial awakening for many Americans. The economic fallout from the pandemic has forced people to take a close look at their financial situation and plan for the future.
New York Life recently took the financial pulse of 2,200 adults in its recent poll. Respondents shared their views on financial goals, debt and financial planning.
Long term goals. The first choice among all age groups except Gen Z, when asked about their long-term financial goals, was to set their emergency fund (between 40 percent and 42 percent). Millennials were more likely to report saving for a down payment on a home than all adults (25% vs. 14%), as well as saving for student loans (13% vs. 8%).
Short-term goals. Holidays were the most popular choice among all age groups (between 31% and 34%) except Gen Z respondents, 40% of whom chose to purchase a specific product they wanted. Millennials were twice as likely to include starting their own business as a short-term financial goal than all adults (18% vs. 9%).
Within each group that selected a certain financial goal, respondents had the most confidence in their ability to manage their vacation payment and credit card debt repayment, and the least confidence in their repayment. student debt and the down payment on a house.
A majority of adults (67%) said they had received a stimulus check to supplement their income in the past year. Respondents reported spending this extra income most often on daily expenses (45%), paying off credit card debt (23%), or building emergency funds (21%).
Debt. One in three adults said their debt caused them anxiety, followed by fear of having to pay for an emergency (24%). More than half of adults (53%) have stopped making payments or reduced their student debt payments during COVID-19. Of these, 49% said they used it more for daily expenses.
Financial planning. Three in four adults said they knew absolutely or somewhat what they were doing about financial strategy. A plurality of respondents (20%) said they would postpone a vacation to compensate for an unforeseen emergency expense, followed by building up emergency funds (17%) and purchasing a product they wish (15%).
Gen Z respondents were less likely than all adults (39% vs. 53%) to say they had a financial strategy before COVID-19. Of those who indicated they had a financial strategy before the pandemic, a majority (64%) said they were somewhat or fully prepared.
A majority (58%) of those who had a financial strategy before COVID-19 and were not already working with a financial professional said the pandemic had not affected the likelihood of them seeking help from professionals in the financial sector. finance. Millennials were the most likely to say they were a lot or a little more likely to seek help from a financial professional.