New Country Financial Survey: As Levels of Financial Security Decline, Americans are Keeping Cash on Hand and Putting Money in Low-Risk Funds
A new survey from Country Financial finds the economy continues to have a negative impact on Americans’ finances. The number of Americans who rate their level of financial security as excellent or good declined by 5 points since Q4 2022.
Additionally, Americans are setting aside less money for savings or investments (53%) and feel less confident in their ability to enjoy a comfortable retirement when the time comes (56%) compared to Q1 2023 (55% and 60%, respectively).
Americans are making financial decisions to withstand the current economy such as:
70% plan to keep cash on hand
58% are putting money in savings accounts
39% are using “safer” investment options like CDs and bonds
33% will invest in the stock market
32% plan to work with a financial advisor
32% plan to take on a side gig to earn more money
“Rising interest rates, inflation, and market volatility are influencing financial decisions,” said Chelsie Moore, Director of Wealth Management Solutions at COUNTRY Financial. “The question is, are these financial decisions being made with consideration for how their goals will be impacted? Or are these panic-button decisions? A financial advisor can help you create a strategy that is tailored to your goals and keeps you on track through economic uncertainty.”
While setting cash aside was the leading response for what Americans are planning to do with their money in today’s economy, it wasn’t the only action they plan to take. The majority (64%) also use at least one long-term investment vehicle like a 401(k), IRA, stocks, bonds, managed account, real estate or an annuity.
Those who work with a financial advisor are much more likely to use those types of long-term investment strategies, including:
Investing in the stock market (17% of those who have a financial advisor are very likely vs 7% of those who don’t)
Put money into CDs or bonds (25% of those who have a financial advisor are very likely vs 8% of those who don’t)
Put money into a savings account at a bank (25% of those who have a financial advisor vs 17% of those who don’t)
“We know from previous surveys that Americans feel most comfortable managing short-term finances and things that are within their control, like a budget, which is why they may feel comfortable keeping cash on hand. However, the same survey told us Americans want help with complicated, long-term goals like managing their investments. So, when the going gets tough, as it has in our recent economic environment, we encourage people to reach out to a financial advisor for their expertise to help them get through it,” Moore added.
Connect with a local Country Financial representative and learn more about how a financial advisor from COUNTRY Financial can help.