GOLDEN VALLEY, Minn. - Americans learned some difficult lessons during the Great Recession. The results from two recent studies of financial habits before and after the financial crisis sheds light on some positive findings. American's are saving more, carrying less debt and feeling more confident about their preparedness for the future.
Dan Ament, Financial Advisor with Morgan Stanley joins KARE 11 Sunrise to discuss.
42% are contributing more to retirement savings: Some 42 percent of 1,154 rank-and-file investors interviewed said they are contributing more to 401(k)s, IRAs or health savings accounts. (Source: Fidelity study "Five Years Later") Similarly, forty-two percent say they increased their emergency fund as well.
American's have less debt: Nearly three-quarters of those surveyed said they have less personal debt now than they did five years ago. (Source: Fidelity study "Five Years Later")
50%+ feel more prepared and less scared: Their pro-active behavior has paid off in mental as well as financial security: More than half of Fidelity's respondents said they felt more prepared and less scared than they did before the crisis. (Source: Fidelity study "Five Years Later")
American's still shy on stocks: On the other hand, our frugality seems to be based on fear. A new report from the research firm Spectrem Group found that Americans have developed a mistrust of the stock market, especially when it comes to their retirement savings. Just 36 percent of investors' 401(k) assets are devoted to stocks, down from 40 percent before the crisis, Spectrem's report found. Barely a third of active workers in Spectrem's survey called themselves confident in the power of the stock market.
Those approaching retirement still concerned: Not a surprise, workers closest to retirement age are the most concerned about their retirement security. Only 35% of the respondents expect to have enough money to live comfortably in retirement. (Spectrem Retirement Market Insights Report 2013)
Bottom line? There is almost always room for improvement with regard to your financial affairs. Take the initiative now to better understand where you stand today, where you want to go tomorrow and what you can do to better assure you will get there!
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