According to a new study from Bankrate, an eye-opening three in four Americans have experienced at least one money-related regret in the last 12 months. Worryingly, many of them identified acute issues with their savings patterns. Those results include almost 4 in 10 respondents who have a concern about their savings plan. In particular, they tend to have concerns about retirement, emergency savings, and paying for their kids’ education. This increasing sentiment speaks to the struggles that Americans are having with their personal finances all over the country.
While a new study, conducted by Bankrate, found that millions of Americans are still wrestling with the right financial move to make. As they face each of these potential regrets, professionals in the financial planning field provide perspective on how to prepare to face these challenges head-on.
Understanding Financial Regrets
Bankrate’s recent survey of financial regret shines a spotlight on the level of Americans’ financial remorse. Nearly three quarters of respondents listed their top financial regret as not saving enough — especially for retirement.
Stephen Kates, a financial analyst at Bankrate, notes, “One consistent takeaway from this study every year is the durability of ‘not saving enough for retirement’ as a regret. The percentage of people with this regret grows with age as retirement draws closer.” This trend just further illustrates the need for our earliest and ongoing savings pursuits to be prioritized.
Moreover, other regrets are notable. Nearly one-fifth of our respondents reported that their greatest regret was incurring too much debt. This proved particularly true for those with credit card debt or student loan debt. Meanwhile, high-interest debts like credit cards average at least 15%, adding to the pressures.
Expert Insights on Savings and Debt Management
Jake Martin, a certified financial planner based in Ohio, wants real action. He adds that it’s most important to save as soon as you can, regardless of when that is. He states, “Starting late is better than never starting at all.” Martin’s perspective is to have consumers focus on solving pressing financial problems first and saving for the future second.
He underscores the importance of addressing high-interest debt as a priority. “These typically carry rates above 15%, making them a drag on your finances and your retirement goals,” Martin adds. These down-to-earth tips will blow your money worries away and put you back in charge of your budget.
Ashton Lawrence, a CFP based in South Carolina, is a proponent of what he calls “controlling the controllables” approach. He advises people to take a hard look at their non-negotiable costs and figure out where the discretionary dollars are seeping away. Lawrence notes, “Identify where discretionary dollars are leaking, whether dining out, streaming sprawl, app subscriptions you forgot about, convenience delivery, impulse buys, and lifestyle creep.” Such targeted intervention allows for a more efficient and effective budgeting and savings approach.
The Challenge of Making Progress
Even considering the knowledge about these top financial regrets, millions of people aren’t able to turn that regret into real results. The survey reveals that 43% of those who acknowledged their regrets did not take any steps toward addressing them over the past year. A number of factors explain this inertia. Personal finance is a confusing enough space, and the burden of being haunted by bad decisions can be a strong psychological anchor.
Martin wants Americans to start increasing their savings rate. He recommends a target of 20%-30% of their income, especially for those who are new to the career in their 40s. Not only can this strategy improve your overall financial picture, it can take the pressure off your need to plan for a successful retirement.
Debt management continues to be an important aspect of overall financial well-being. Paul Gaudio underscores the importance of prioritizing credit card debt while managing other debts like student loans and mortgages more strategically.