Retirement Not Americans' Only Financial Concern

Eighty-five percent of Americans are financially anxious, and 36% say it has gotten worse in the past three years, according to the 2016 Northwestern Mutual Planning & Progress Study.

Only 14% say their feelings of financial anxiety have improved, and nearly one-third, 28%, say they worry about their finances every day.

Americans’ two biggest financial fears are facing an unplanned financial emergency (38%) and incurring an unplanned medical expense due to an illness (34%). These outpaced outliving their retirement savings (21%), losing their job (17%) or being unemployed for an extended period of time (15%). When asked what the source of their financial concerns are, 55% said unexpected expenses, followed by saving for retirement (29%), health care costs (27%), mortgage or rent (25%), credit card debt (25%) and student loan debt (13%).

A recent Federal Reserve Survey found the number one reason employees says they do not participate in their employer-sponsored retirement plans is they cannot afford to contribute.

“There’s the sense that people are just staying afloat, that they’re meeting their most immediate financial needs but that they are worried about what they can’t see or don’t expect,” says Rebekah Barsch, vice president of planning and sales at Northwestern Mutual. “They fear the unknown. They don’t know how to plan for the unplanned, and they worry that if something unexpected happens, it could have deep and lasting consequences.”

Asked what they think are the benefits of financial security, 52% said “peace of mind that I never have to worry about day-to-day expenses,” 22% said the “flexibility to live a desired lifestyle,” and 8% said “freedom to pursue my dreams.”

Harris Poll surveyed 2,646 adults between February 1 and February 10 for Northwestern Mutual. The 2016 Northwestern Mutual Planning & Progress study can be downloaded here.