Top 3 Financial Resolutions
A record-breaking number of Americans (54%) are considering kicking off 2014 by making financial resolutions, according to the fifth annual “New Year Financial Resolutions Study” by Fidelity Investments.
That’s good news for employers, many of whom are increasingly embracing the concept of financial wellness — 81% of HR pros in a recent survey say they believe they are at least somewhat responsible for their employees’ financial wellness.
According to the Fidelity study, 26% of respondents report that their financial situations have improved from the same time last year, marking an increase from 19% in 2012.
Among the top-three financial resolutions are:
Saving more (54%)
Paying off debt (24%)
Spending less at (19%)
These are the same top-three financial resolutions from last year, but paying off debt jumped from the No. 3 spot to No. 2. Since 2010, the commitment to debt reduction has risen from 8% to 24%.
For respondents who place saving more in their top-three financial resolutions next year, they are now focusing on short-term goals as opposed to long-term goals, such as retirement, college savings or retiree health care. These short-term goals include paying credit card debt, creating an emergency fund or putting away money for a significant purchase. In fact, 39% of respondents this year are more focused on short-term goals, a jump from 29% last year, while 53% of respondents are saving for long-term goals, down from 65%.
“The financial crisis of five years ago forced many people to wake up to the importance of preparing for whatever may come their way,” says Ken Hevert, vice president of retirement products at Fidelity Investments. “This year’s findings suggest people are increasingly recognizing the importance of achieving a balance between meeting near-term financial goals and planning for the long term. Hopefully, this means that some important lessons have been learned, including avoiding costly moves, such as tapping into a retirement nest egg simply to lower debt payments and have short-term cash on hand.”
Amanda McGrory-Dixon, Employee Benefit News