Americans Recognize Need for Financial Plan

According to the survey findings from the Certified Financial Planner Board of Standards, Inc., 82% of Americans recognize the urgency of creating a financial plan. Additionally, nearly 60% of respondents said they would benefit from the counsel of a financial planner or adviser.

Three key insights from the survey show that Americans struggle to balance short- and long-term concerns, and are aware of a changing economy:

1. Survey respondents hold themselves accountable for their own financial security, but said they look to the government for an individual safety net. They also believe strongly that the government has a role in protecting people from fraud and abuse.
2. Americans are divided on how they are faring in their personal financial situation as compared to one year ago. However, Americans express more optimism for their future financial situation.
3. Aside from the immediate concern of filling up their gas tanks, the majority of Americans’ concerns center on longer-term issues like saving for retirement and reductions in federal benefits. Outliving assets and living with increased financial risk is top of mind for a subset of Americans.

The survey's findings also show that age, income, ideology and race play an important role in shaping Americans' views on their own personal economic situation:

•  When it comes to providing financial security, 67% agree they have sole responsibility for their financial future, but Americans by a large margin want the government to provide some sort of safety net (72% for Social Security/68% for Medicare).

•  More than two-thirds of Americans (67%) believe it is the government's duty to protect investors from fraud and abuse.

•  Americans are conflicted when it comes to their financial security: many (44%) don't feel any better about their financial security than they did a year ago, and nearly a quarter (23%) feel more negatively toward their financial situation.  But half of Americans (51%) are optimistic their financial situation will improve over the next year, and less than one-in-10 expect it to decline. 

•  Over the next year, 79% of blacks and 76% of Hispanics expect their financial situation to improve. Less than half of whites (43%) expect their situation to improve.

•  Those identifying themselves as black or Hispanic are far more positive about their current financial situation than whites, with 41% of blacks saying they are more positive now than a year ago, and 43% of Hispanics saying the same.

•  Those identifying themselves as "liberal" register the highest degree of optimism at 62%; 44% of those identifying themselves as “conservative” expressed such optimism.

•  Daily financial concerns are top of mind for most Americans; among the primary concerns: filling up their gas tank (54%), securing and paying for health insurance (46%), making their housing payment (39%) and getting or keeping a job (38%).

•  Securing and keeping a job is of paramount importance to young people (18-34), with 51% of women and 55% of men expressing this as a major financial worry.

•  Long-term issues weigh heavily among respondents, with 49% saying they are troubled about their retirement savings and 48% concerned about a reduction in government benefits. Only 40% of all Americans believe they will be able to retire by 65, and only 27% of males 18-34 say they will be able to retire at that age.

•  A third of Americans express concern that they will outlive their retirement assets, and nearly two in five feel their financial security is more at risk than ever before.

•  Similarly, 72% of older women (65 and older) express concerns about reductions in government benefits like Social Security and Medicare, while just 33% of women ages 18-34 share that concern.

•  Those with incomes of less than $35,000 are more concerned with securing and paying for health insurance (58%) and a reduction in government benefits (58%) than those in higher income brackets, with only 26% of those making $100,000 or more a year concerned about their health insurance needs.

The survey was conducted by KRC Research between March 1-4, 2012, via telephone among 1,015 Americans ages 18 and older.

View the full report for the Shifting Economy Survey.