Survey: Americans Increasingly Worry About Their Finances Due to Covid-19 Pandemic
In the wake of the coronavirus pandemic, a new study shows that Americans are becoming increasingly anxious about their finances.
Back in April, Fidelity asked 3,062 retired and working-age Americans about their concerns and what they were doing to shore up their confidence gap. In the survey, 60% of Americans said they were concerned about their finances now. Thirty-eight percent were extremely or very concerned, while over twenty percent were just moderately concerned.
Six in 10 (62%) Americans said they worried about job security, with 43% being extremely or very concerned. 51% of baby boomers said they were worried about their finances over the next 6 months. Meanwhile, 69% of millennials and 68% of Gen Xers also shared that concern.
A Big Life-Changing Impact
The economic disruption of Covid-19 is being felt on a very broad scale. It has had effects in many facets of life.
Four in 10 Americans (43%) said their stress over their finances had worsened. A third said it was affecting their sleep, twenty-four percent their exercise habits, and twenty-three percent their healthy eating habits.
Increased responsibilities both at home and at work due to the pandemic have also been stress contributors.
Almost half (49%) said they didn't have time to check their investments and retirement savings because of the time constraints with these increased duties. Fidelity's survey also found that women were more likely to say they were impacted by the pandemic than men.
What's on Everyone's Minds?
Nearly half of women said they were feeling more anxious about their finances. Meanwhile, thirty-eight percent of men said they were more anxious. This also reflects a finding by researchers showing that women accounted for 55% of the increase in job losses in April, according to NPR.
What about specific financial concerns? Surveyed Americans reported as top concerns:
- Paying down student loan debt
- Having enough saved to retire as they planned
- Paying other debt than student loans
- Having the ability to pay for kids' college education
- Finding the money to pay for other goals
- Having the ability to pay monthly bills
Rethinking Money Management
With the early effects of the pandemic now more in the rearview (and with the uncertainty of what lies ahead), many Americans are also rethinking their finances and improving their financial wellness. Among other things, 34% are rethinking how they manage their money.
There has been a noticeable flight to safety in the investment arena. Vehicles such as fixed and indexed annuities are becoming increasingly popular alternatives to instruments that invest directly in the markets.
Those with a Financial Plan Fared Better
The survey also bolstered the value of having a financial plan for shorter-term goals as well as retirement. Those who had a plan set reported better outcomes than those without one.
Among people with a financial plan, 50% had at least 3 months' worth of expenses in their emergency fund, and only 35% were concerned about paying monthly bills. For those with no plan, respectively, only a third had at least a 3-month emergency fund and 45 percent worried about paying monthly bills.
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