Financial Defeat: Many Americans Struggle with Financial Challenges and Feel Financially Defeated
Many Americans are feeling financially defeated due to a variety of challenges such as high inflation, credit card debt, and student loan repayments, according to a recent survey by Achieve, a personal financial organization. The survey found that only one in 10 respondents felt they were living their definition of financial freedom.
The most common definitions of financial freedom selected by respondents included living debt-free, living comfortably without being rich, the ability to meet financial obligations with money left over, and never having to worry about money. Surprisingly, fewer respondents associated financial freedom with being rich or having enough money to stop working altogether.
Andrew Housser, Achieve’s co-founder and co-CEO, attributed the feeling of defeat to the high costs of goods and services, record high interest rates, over $1 trillion in credit card debt, and the burden of student loan repayments. Many Americans are struggling to make ends meet and lack a well-funded savings account, with 40% of respondents not even having a basic bank savings account.
The survey also revealed that a significant number of respondents do not have professionally managed investment accounts or retirement savings, highlighting the need for improved financial literacy. Low levels of financial literacy can lead to stress and financial losses, with studies showing that it could cost the average household over $5,000 annually.
Brian Haney, founder and CEO of The Haney Company, emphasized the importance of enhancing financial literacy to help more Americans achieve financial freedom. While efforts to improve financial literacy have been made, there is still a need for better education on financial management.
Steps to improve financial literacy include helping consumers set financial goals, understand their current finances, create and stick to a budget, and plan for retirement. By empowering individuals with financial knowledge, the financial services industry can better serve a broader range of clients and help them achieve their financial goals.
The survey data was based on responses from 1,000 U.S. consumers aged 18 and older and is representative of the Census Bureau benchmarks for age, gender, race, and ethnicity. The findings underscore the importance of addressing financial challenges and improving financial literacy to help Americans feel less financially defeated.
