The State of Planning in America Study is a series of research examining what kind of planners people are, how their plans may have changed over time, whether they feel they’re moving in the right direction, how they assess their ability to stay on course, and how this all fits against the larger backdrop of what is taking place in America today. The study surveyed more than 1,000 Americans aged 25 or older between February 2 and February 13, 2012.
Planning & Progress
The first phase of the of the State of Planning in America Study found that a large number of Americans (half of those surveyed) take an informal approach to financial planning – if they have a plan at all – and even more (59%) feel their financial planning needs improvement. The findings from the research also reinforce that finances are very likely top of mind for many Americans and that people continue to be highly cautious about risk.
Other survey results include:
- The number one approach to saving and investing is “slow and steady wins the race” (36%). Yet more than one-fifth (21%) indicated, “I’d like to be more cautious but I have a lot of catching up to do.”
- Among priorities for improvement in 2012, finances (43%) jumped 7 percent from 2011 and came second only to personal health (48%). This was well ahead of spending time with family and friends (31%), career (12%) and education (5%).
- Americans appear risk-averse; 40 percent of respondents show a strong preference for safer but lower returns with very low risk versus only 25 percent who strongly prefer the opportunity for higher returns with higher risk.
- The majority of Americans surveyed are taking steps to pay down their debt (62%), develop a budget (61%), save a portion of their paycheck regularly (58%), build up an emergency fund (58%) and organize financial documents (56%).
Longevity & Preparedness
Centers for Disease Control data shows that average life expectancy for Americans today is 78.2 years, with women living to more than 80 years old on average. The second phase of the State of Planning in America Study revealed that Americans are startlingly unprepared financially to live to these average life expectancies. The study found that:
- Only slightly more than half of Americans (56%) feel financially prepared to live to the age of 75.
- Less than half (46%) indicated that they feel financially prepared to live to the age of 85.
- Barely more than one-third (36%) said they feel prepared to live to age 95.
- Men regardless of age are significantly more likely than women to feel financially prepared to live to age 75 (65% vs. 48%), 85 (55% vs. 37%), and 95 (43% vs. 30%).
- Younger Americans (25-59) feel less prepared than older Americans (60+) to live to 75 (47% vs. 79%), 85 (37% vs. 66%), and 95 (29% vs. 52%).
The Planning Perspectives Study asked respondents to weigh in on whether they as individuals and the nation as a whole are moving in the right direction when it comes to key financial planning categories. The research revealed that Americans feel very differently about their own planning compared to the nation.
When asked whether individuals and the nation are moving in the right direction:
- Debt: 79 percent of respondents said they are moving in the right direction in the area of managing debt, compared to only 11 percent that feel the same way about the nation.
- Education: 75 percent feel their children’s education is moving in the right direction versus 19 percent said the same about the nation.
- Work: 73 percent feel they are moving in the right direction in the area of their career compared to 28 percent feel the nation is moving in the right direction in the area of jobs.
- Spending: 66 percent of respondents said their personal spending is moving in the right direction, versus 13 percent said the same about the nation.
- Saving: 66 percent responded they are moving in the right direction in the area of saving versus only 12 percent feel the nation’s saving is moving in the right direction.
- Health: 64 percent feel their health and fitness is moving in the right direction, compared to 23 percent responded that the nation is moving in the right direction in the area of health care.
- Investing in Improvements: 66 percent of respondents said when it comes to investing in improvements in their lives (e.g., going back to school, making home repairs, etc.), they are moving in the right direction, compared to 25 percent feel the nation’s investment in infrastructure is moving in the right direction.