How Consumers Feel About Finances in 2024
February 12, 2024 | 1 min read
Finances are a major part of people’s lives and can have a huge impact on their health, emotional state, productivity and much more. When it comes down to it, financial stress is one of the biggest burdens people bear. A report by the American Psychological Association found that 1 in 5 Americans say that they have either considered skipping or skipped going to a doctor when they needed health care because of financial concerns. Financial stress is also at the root of a lot of relationship problems. A report from Experian shows that 59% of divorces nationwide have financial stress as a contributing factor, and there’s a 3x higher rate of domestic violence among those with high financial stress.
Perhaps the most alarming findings show that financial stress is also one of the biggest contributors to suicides. According to Money and Mental Health, 23% of people who attempted suicide last year were in problem debt. Additionally, people who are in problem debt have approximately 1.8 times the odds of thinking about suicide.
One way people can lessen the stress of their financial burden is with a more positive outlook. Studies have shown that there’s a correlation between happiness and financial wellness. However, for most people, it might feel like an impossible task.
Here’s a breakdown of the different ways financial stress affects people’s lives.
Our careers are central to so many aspects of life. They often give us purpose, afford our lifestyles, and help improve the quality of our lives. However, when financial stress looms, it can be difficult to be productive at work and feel like we’re making a positive impact. In fact, a survey by My Secure Advantage shows that 97% of employees concede to working on or thinking about personal finances during their work day. And 60% of employees said they have lower productivity at work because of stress.
Not only does financial stress impact employees however, it also has a negative impact on businesses. That same report also shows that 58% of employers see financial stress as a prevalent part of employee absenteeism and 78% say employee productivity is negatively affected by financial concerns. On a large scale, financial stress is so pervasive that it inevitably hurts the growth of businesses and the economy nationwide.
As it turns out, it doesn't matter how old you are or even how much money you have in the bank. Financial stress impacts everyone. Forbes states that two-thirds of Millennials owe some kind of long-term debt, and 53% claim that debt is overwhelming. And when it comes to older generations, things don’t look much better. According to AARP people age 60 and over owe roughly 30% of the cumulative nation credit card debt, with balances totaling $260B.
It seems that no matter where you are on the socio-economic spectrum, financial stress can still be a major factor in people's lives. Forbes also found that 50% of millennials are worried they won't be able to pay back their student loans, including 34% who earn a household income of more than $75,000 per year.
One of the most demanding and admirable jobs in the world is becoming a military service member. Being part of the military requires a lot from people: a lot of dedication, hours, and focus. So it’s not surprising that there’s not always much time to keep track of financial matters.
Unfortunately, the financial stress is also often felt by the entire family. In fact, a staggering 65% of military families experience financial stress.
Perhaps the most devastating part is that often these service members don’t have enough to cover basic needs. A study by Military Saves found that 60% of military respondents don't have enough in their savings to cover three months of living expenses. And The Military Family Advisory Network found that, overall, “86% of military and veteran families suffer physical and emotional effects from financial strain.”
Financial stress burdens everyone alike. It doesn’t matter how old you are or how much you make. Fortunately, there have been various advancements in technology in the last decade or so focused on improving people’s financial lives. This is a huge opportunity for financial institutions to step in and lead people to financial wellness. However, there’s still a lot of work to be done. Today, nearly 60% of people say that their primary financial institution doesn't help them become financially stronger. And according to J.D. Power, “78% of retail bank customers want guidance." And that’s where technology can help. With the use of technology, financial institutions can now help their customers build better financial habits. The right tools make managing finances much easier and simpler. Tools that offer smart budgeting options and proactive notifications, allow consumers to more easily understand and take control of their financial lives.
MX helps financial institutions access and act on their data so they can really know their customers and help them make the best financial decisions at every point of their financial journey. Financial institutions can become much more than the simple go-to when it comes to transactional interactions, they can deepen customer relationships with proactive guidance every step of the way.
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