Americans plan to tighten their beltsBy Andrew Rickard | August 31 2016 09:17AM
A recent survey has found that reducing debt and saving more are the top financial goals for most people in the United States. About one in four are concerned that they could outlive their retirement funds.
Last week, the US division of BMO Wealth Management released a report which examines how Americans balance their decisions between saving, investing, borrowing and spending. It found that reducing or eliminating debt was the single most important financial priority for 31% of the respondents, while 26% said that saving more was their primary concern. The remaining were focused on investing effectively and tax efficiently (21%), budgeting (14%), and spending on personal needs or goals (4%).
42% of Americans are worried about unforeseen expenses
In addition, the study reveals that 42% of Americans are worried about being caught off guard by unforeseen expenses. Asked about the unanticipated costs they had already faced (respondents could give more than one answer), 44% had paid out of pocket healthcare costs for themselves or family members, 40% had paid a major bill after an unexpected incident, 33% had provided financial support for family member, and 28% had lost income, benefits or savings as a result of job loss.
BMO also surveyed Americans about the events that had made it difficult for them to save or invest. The previous loss of money in the stock market (31%), a business venture (17%) and the sale of a property that had declined in value (16%) were most frequently cited.
Fears about not being able to save or invest
"These losses that have occurred in the past weigh on people’s minds and may make them more tentative and fearful as they prepare for their financial futures. The survey found that fears about not being able to save or invest towards financial goals were frequent (30% of those surveyed), and a fear of outliving any savings that could be accumulated was also high on the list (24%)," reads the report. "Others feared events over which they had little control, including a negative global economic event (11%), a long-term downturn in the stock market (11%), not being able to save due to job loss (9%), and declining home values (6%)."