A recent USAA survey of 2,730 adults suggests that consumers need to look more closely at how they invest their money, plan for financial ups and downs and pay for day-to-day purchases.
“[Americans] hope to save a lot of money for retirement, but many haven’t saved even one dollar yet,” said June Walbert a financial planner with USAA, in a release. “Failing to do a little homework can lead to ill-advised investment decisions that can impact retirement savings,” she added.
The USAA survey found that 25% of US adults who have an investment account have made an investment decision based solely on a friend or family member’s recommendation, while 23% say they’ve gone with their gut instinct. The survey also found that men (27%) are more likely than women (17%) to follow their gut instincts when investing.
Americans look in various places when they need to make up for financial shortfalls, with more than half borrowing money from family members.
- 39% have gone to their parents for money.
- 13% have turned to a sibling.
- 5% have borrowed from their children.
- 11% have approached another family member.
The likelihood of turning to family members varies among different age groups, with 68% of 18- to 44-year-olds were more likely to have borrowed from a family member in the past, and 26% of adults over the age of 55 have borrowed money from family members.
The survey also found that the high volume consumer credit card use is hurting retirement saving. According to the survey, 43% of US adults said they have used their credit cards to pay for purchases of less than $5, and 33% of those individuals doing so at least once a week. This trend is most prevalent among younger adults, with 55% of 18- to 34-year-olds saying they have used a credit card for purchases of less than $5.