Disclaimer: This Inside South Florida segment is sponsored by Edelman Financial Engines. All opinions and views are of the advertiser and does not reflect the same of WSFL-TV.
Despite improving economic indicators, many Americans still don’t feel wealthy, according to a new study conducted by Edelman Financial Engines. The study, now in its third year, reveals surprising findings about how Americans perceive wealth, handle debt, and make financial decisions influenced by social and political factors.
In an interview on Inside South Florida, Jean Chatzky and Isabel Barrow discussed key findings from the study. One of the most unexpected results was that only 12% of respondents said they feel wealthy. Jean Chatzky, CEO of HerMoney Media pointed out that, even though wages have increased, inflation has eased, and housing values are up, the perception of wealth remains stagnant. “Six in 10 people said they need over $100,000 a year to feel wealthy, with 25% saying they need over $200,000,” se noted.
The study also highlighted that credit card debt continues to be a major obstacle to wealth-building. More than 40% of respondents identified credit card debt as their biggest challenge, with many carrying balances month-to-month. Disturbingly, 40% of those with debt have balances over $10,000, and 20% owe more than $20,000.
Financial Planner Isabel Barrow of Edelman Financial Engines raised concerns about the growing popularity of "buy now, pay later" options, which she called “phantom debt.” “It seems convenient at the time,” she said, “but ultimately it’s just another form of debt, and it's diverting funds from savings and investments.”
The study revealed that Generation X is feeling the financial squeeze more than any other group. "Gen X is dealing with the dual pressures of putting their kids through college while also caring for aging parents," Isabel explained. "They are also the first generation without access to traditional pensions, which has left many feeling unprepared for retirement."
More than half of Gen X respondents said they’ll need help from a financial professional to achieve their financial goals.
One surprising finding from the study was the impact of political events on financial decision-making. “One-quarter of respondents admitted they’ve made financial moves, such as moving money in or out of investments, based on anticipated election outcomes,” said Jean. She stressed the importance of avoiding emotional decisions based on political leanings. “Money is not red or blue—it’s green,” she reminded viewers.
Despite the challenges, there is some good news. The study found that three-quarters of those who work with a financial professional report less stress about money. “Having an expert in your corner can be a huge help,” Jean emphasized.
For more information on the findings and to access the full study when it’s released, viewers can visit EdelmanFinancialEngines.com.
