As COVID-19 cases continue to drop and vaccination rates increase, Americans are starting to see the light at the end of the tunnel and are increasingly more conscious of not only their finances, but also their wellbeing. In New York Life’s latest Wealth Watch survey of 2,200 American adults, more than half of respondents say they are thinking about their finances (54%) and physical health (58%) more than they were at this time last year, and 47% are shifting more focus to their mental health.
Coming out of what has been a tumultuous and uncertain time for many, this transition period has presented a natural opportunity for many Americans to pause and reassess their priorities and financial strategies. In general, Americans are gaining confidence in their long-term goals: 72% report confidence in their ability to retire at their desired age, respondents are 33% more confident in the status of their savings, and nearly half (48%) say they feel prepared to afford the recurring expenses that began during the pandemic.: A vast majority of respondents also report confidence in affording near-term expenses, like maintaining pet care for pets acquired before (94%) or during (93%) the pandemic and attending summer weddings (93%).
With this increased confidence, Americans report a readiness to participate in a re-opened economy. More than four-in-ten (44%) said they plan to go out more this summer, and at least one-in-three said they plan on visiting and/or reuniting with family (39%), eating out more (35%), and traveling domestically (34%). Americans are also finding ways to achieve their short-term financial goals this summer – with 33% reporting they’re prioritizing paying for a vacation, 24% buying a specific product, and 23% buying a car.
The positive correlation between short- and long-term confidence makes sense. Throughout 2020, many Americans had the opportunity to plan ahead for upcoming leisure costs, as they anticipated an eventual return to pre-pandemic normalcy and the regained ability to travel and attend events once the pandemic reached its end. This planning appears to have paid off: Over nine-in-ten (93%) respondents indicate they are confident that they will be able to afford attending a wedding or multiple weddings this summer, and almost half (48%) say they have been saving up to travel abroad since the start of the pandemic.
Short- and long-term financial confidence are not rivals; rather, when fully optimized, they can happily coexist.
Older Millennials, who entered the job market during the 2008 financial crisis, have arguably been dealt an economic double-whammy as adolescents or young adults. Despite Millennials’ reporting feeling more prepared for a financial emergency than their peers at a higher rate than all adults (31%, vs. 24%), almost one-in-three (32%) said resuming costs paused by the pandemic will negatively impact their budgets.
In addition to resuming paused expenses, Millennials are anticipating increased spending on other leisurely activities. Like other adult generations, Millennials want to begin traveling again. However, almost half (47%) Millennials agreed that they want to travel a lot this summer but can’t afford it, compared to 36% of all adults.
Sensitive to the potential financial burdens that may lay ahead, Millennials have indicated that they’re aware of the importance that a financial strategy can offer in helping them plan for right now as well as for tomorrow. Millennials were more likely than the total population to create or re-evaluate their financial strategy as life returns to “normal” (54% vs. 43%).
Additionally, Millennials were also the demographic most likely to express willingness in seeking guidance from a financial professional (61% vs. 38% of Gen Xers and 50% of Gen Zers).
“Our data suggests that for Millennials specifically, this inflection point in their lives is a chance to understand that it’s not only possible to have fun and afford travel or celebrating friends’ marriages, but that they can also adhere to a holistic financial strategy that creates a secure financial future” - Aaron Ball, Senior Vice President
“Our data suggests that for Millennials specifically, this inflection point in their lives is a chance to understand that it’s not only possible to have fun and afford travel or celebrating friends’ marriages, but that they can also adhere to a holistic financial strategy that creates a secure financial future,” says Aaron Ball, Senior Vice President, Head of Insurance Solutions, Service, and Marketing at New York Life. “While this message is clear for Millennials, the benefit of human guidance from a trusted financial professional transcends generations.”
ABOUT WEALTH WATCH
Wealth Watch is a new recurring survey from New York Life that will track Americans’ financial goals, progress toward those goals and feelings about their ability to secure their financial futures, identifying key themes and trends that are emerging about topics like retirement planning, the role of protection-oriented solutions and the importance of financial guidance.
This poll was conducted between June 16 and June 20, 2021 among a national sample of 2,200 adults. The interviews were conducted online and the data were weighted to approximate a target sample of adults based on gender, educational attainment, age, race, and region. Results from the full survey have a margin of error of plus or minus 2 percentage points.
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