Financial stress has become a defining feature of American life, and it’s driving folks to take action, according to a recent survey by Empower.
Respondents rated their overall financial happiness at just 4.97 out of 10 and their retirement savings satisfaction at just 4.54 out of 10.
But as economic uncertainty looms, the financial services company’s survey of over 2,200 American adults shows that 91% of respondents are prioritizing their financial health and taking steps to try to ease their money worries.
Specifically, they’re embracing the following strategies to reduce stress when it comes to money.
Cutting back on wants
Tied for the most popular financial stress-reduction strategy among survey respondents was trimming the fat from monthly budgets. According to Empower’s findings, 32% of Americans are cutting non-essential expenses. This isn’t about deprivation — it’s to create breathing room in tight budgets.
Scrutinizing subscriptions, dining out less frequently and postponing big purchases, for example, are sacrifices that can add up and provide some financial relief.
Trading down instead of going without
Additionally, 32% of survey respondents said they are switching to cheaper brands to help reduce their financial stress — a trend Money Talks News recently examined in “10 Store-Brand Products We Buy Over and Over Again.”
Building a safety net
Perhaps most encouraging, 30% of survey respondents say they are taking action by building emergency savings funds. This proactive approach addresses the big fear of unexpected expenses derailing carefully balanced budgets.
Incidentally, Empower’s survey also found that 76% of respondents believe they need more savings to prepare for the unexpected.
Even modest savings could provide significant peace of mind, as 71% said a windfall of just $5,000 would boost their financial happiness for at least six months.
Looking ahead
In the face of economic uncertainty and financial discomfort, many are looking to take action. Almost half of respondents (43%) say their big plans for this year include figuring out how to earn more money, and over a third (37%) want to learn how to be financially happy.
Empower says one bright point of the survey is that 78% of respondents reported that having a financial plan makes them happier and less stressed. Nearly a third plan to create a financial plan in 2025, with younger generations — 42% of Generation Z and 39% of millennials — leading the charge.
Rebecca Rickert, head of communications and consumer insights at Empower, has this to say about the survey findings:
“What we’re seeing across these scores is more than economic uncertainty — it reflects what we’re calling a ‘Great Decide.’ People find themselves at financial crossroads with important choices about saving, investing and, critically, where to turn for advice to get where they want to go.”
Professional financial advice is key for 65%, with 58% reporting that they need trusted financial advice now.
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