Illustration of a dejected person sitting on a downward pointing arrow, surrounded by dollar signs.

Faced with a wide range of financial challenges including high inflation, high credit card debt and the repayment of student loans, it’s not surprising to learn that many Americans are feeling financially defeated. According to a survey by Achieve, a personal financial organization, only one in 10 surveyed said they are living their definition of financial freedom.

When the survey asked consumers to select the ideas of financial freedom that they were the most in agreement with, the most common definitions were:

  • Living debt free: 54.2%
  • Living comfortably, but not necessarily being rich: 50%
  • The ability to regularly meet all their financial obligations and still have some money left over each month: 49.3%
  • Never having to worry about money: 46.2%

Surprisingly, far fewer respondents believe financial freedom means being rich (12.6%) or having enough money to give up working altogether (32.1%).

Why so many are feeling defeated

Many consumers are feeling defeated because according to Andrew Housser, Achieve’s co-founder and co-CEO, quite a few of them are grappling with the high costs of goods and services, record high interest rates, credit card debt surpassing $1 trillion, and the repayment of student loan debt, which is tightening many already stretched wallets.

“Recently,” he added, “we asked Americans how they felt about their financial situation. We’re seeing far fewer Americans with the goal of becoming ‘rich’ and many families pivoting to just trying to be able to pay their bills on time. With all the economic pressures facing American families, financial freedom is currently more about making ends meet.”

Over half of the respondents also said they are not anywhere close to reaching their personal definition of financial freedom. According to Housser, at the forefront of this challenge is that many Americans lack a well-funded savings account. In fact, 40% of respondents don’t even have a basic bank savings account, and among those who do, 35.8% have less than $1,000 in their savings account.

How Americans manage finances

The survey also explored ways in which Americans are managing their personal finances and navigating their journeys toward financial freedom. Among the findings:

  • 78% of consumers report having a checking account (65% of Gen Z, 76% of Millennials, 81% of Gen X and 86% of Baby Boomers), compared to 60% of consumers with a savings account (58% of Gen Z, 61% of Millennials, 57% of Gen X and 62% of Baby Boomers).
  • Surprisingly, more consumers reported having a cryptocurrency wallet (13%) than a professionally managed investment account (10%).
  • Only 33% of respondents reported having an IRA/401(k) retirement account, and just 40.8% said that they are very confident they will be financially secure once they retire.

Helping consumers feel less defeated

Apart from the pressures involved with navigating today’s uncertain economy, some of the reasons many Americans are feeling so financially defeated may stem from their low levels of financial literacy. According to many studies, low levels of financial literacy often result in a high level of stress, and often cost consumers money.

For example, an Allianz study found that low levels of financial literacy could be costing the average household in the U.S. around $5,059 every year. And over a 10-year period, this could amount to $84,458, compared to households led by people who really understand financial basics.

But despite numerous efforts to enhance financial literacy over the years, it remains a crucial challenge that financial professionals and major industry firms need to find a better way to address, said Brian Haney, founder, CEO of The Haney Company. The problem stems well beyond the current structures for the common delivery of financial services.

“At its core,” he said, “is the fundamental fact that we do not equip ourselves at any level of our educational system with the basic principles of financial management. So, unless someone elects to study the subject themselves, or benefited from some volunteer- driven programming often delivered to schools through non-profits and outside parties, many people enter the workforce trying to “figure out money,” as they do in many other aspects of their lives.”

When the public’s grasp of financial concepts improves, Haney added, the financial-services industry’s ability to help more Americans radically improves as well, because it makes it easier, not harder, to work with more people. Haney pointed out that “at the end of the day, if we truly want to grow our capacity to serve more people and grow our practices across broader markets, improving financial literacy is of paramount importance and a foundational necessity.”

However, there is good news, Haney added, since many states have now adopted laws requiring financial literacy to become a core part of the high school curriculum. “This is a significant move in the right direction,” he said.

Steps to financial literacy

Another step in the right direction is for agents and advisors to help their prospects and clients better manage their finances to help them achieve what they would consider their financial freedom. To do this, Housser suggested that they can:

Let consumers know they aren’t alone. More than 100 million people in this country are struggling as they deal with debt and trying to get on a solid footing with their finances, Housser said.
Guide them through the goal-setting process. “The cornerstone of personal finance management is knowing what you really want to do and have in your life,” Housser pointed out. “Goals, both short- and long-term, will modify throughout life, but will guide budgeting and financial planning, increase self-confidence and ease stress.”
Make sure consumers understand their current finances. There are some basic figures to become familiar with and know, including total and net income, monthly expenses, assets, debts, and debt-to-income ratio.
Help them create and consistently use a budget. Budgets scare away many people, but they really are just spending plans. “If you know what your goals are, you can build the budget around those goals (knowing that goals, timeframes and dollars will likely be modified),” he said.
Work through what people realistically need financially to retire. Even young adults need to do this. While “retirement” may seem far off and not relevant, almost everyone can relate to creating the option to do what they want when they want, Housser said.

Survey data and findings are based on an Achieve survey conducted in July 2023 among 1,000 U.S. consumers ages 18 and older and is representative of Census Bureau benchmarks of the U.S. population for age, gender, race, and ethnicity.


Ayo Mseka has more than 30 years of experience reporting on the financial services industry. She formerly served as editor-in-chief of NAIFA’s Advisor Today magazine. Contact her at [email protected]

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