2017 is finally here and many Americans are optimistic about what the next twelve months have in store for their personal finances. For example, 43 percent of adults recently surveyed by New York Life said that they believe their financial situation will improve in the new year, up from 31 percent in the 2011 poll. Forty-six percent of respondents also believe that their family will be more financially secure and better prepared for the unexpected in 2017, and 41 percent anticipate being in better shape for retirement. Such outlooks are not too surprising since roughly two-thirds of surveyed Americans said that they plan to save more and reduce debt in the new year.
These smart financial moves are easier to make with greater job security and income growth, and more than a third of respondents expect that there will be better opportunities for career growth and advancement in 2017. The election of Donald Trump likely has something to do with this brighter economic outlook, as evidenced by a recent Bankrate survey which found that more than a quarter of Americans expect the results of the Presidential election to have a positive impact on their personal finances. Among these respondents, 35 percent anticipate that they will pay less in taxes, 24 percent expect to receive an earnings boost, and 18 percent see the value of their investments rising.
Shifting the focus back to the New York Life survey, 57 percent of adults said that they will be making more long-term plans for their financial future in 2017. However, respondents on average defined “long-term” as just 4.4 years, nowhere near the level of farsightedness needed to effectively prepare for a comfortable and secure retirement. Fortunately, around one in four surveyed adults said that they plan to seek professional help with the management of their finances in the new year. That is great news because an advisor can greatly assist in ensuring an ideal retirement outcome by making sure that a client’s actions are aligned with their financial goals.
Moreover, an earlier report from John Hancock found that seven in ten surveyed Americans who regularly work with a financial advisor said that they are “on track or ahead” in saving for retirement, while only a third of respondents who do not work with an advisor reported the same level of preparedness. Individuals who consult with a financial advisor were also found to be more likely to know how much they will need to save for retirement and regularly set money aside toward that goal. Further, people who work with a financial advisor had a higher probability of maxing out their 401(k) plan contributions and establishing an emergency savings fund to help them avoid dipping into their retirement assets early.
Sources: New York Life, Bankrate, John Hancock Retirement Plan ServicesPost author: Charles Couch