While American consumers in general are confident about the state of their finances, a good number of them are, in fact, overconfident about said financial state, as they do not do enough to ensure that their finances actually remain healthy. This was revealed in the National Foundation for Credit Counseling 2015 Financial Literary Survey, which was jointly released by the NFCC and NerdWallet.
Over 2,000 adult Americans were covered by the survey, and 92 percent of these consumers said that they are either “very confident” or “somewhat confident” when it comes to their most recent major financial decision – this would include choosing a credit card, taking out a mortgage, and buying a new vehicle. 59 percent of consumers, on the other hand, said that they would give themselves an “A” or a “B” in terms of their financial wallet.
But despite this rosy picture many consumers had painted for themselves, close to 70 percent said that they are worried about their finances in some way or another. Exactly 60 percent said that they do not have a budget for their monthly spending, and 21 percent said that their spending in 2015 is on track to outstrip their spending in the year prior. 57 percent said that they are saving for their retirement nest egg and another 66 percent said they currently have savings for reasons other than retirement, but 28 percent said that they may not have enough money saved up.
Student loan debt, which has been singled out as a common pain point for consumers, especially younger ones and those who had paid for their children’s college education. 58 percent said that they cannot start a retirement or emergency nest egg or even buy a new car because of their outstanding student loans.
A mere 6 percent of consumers who took out student loans admitted that their investment was a good one, and there were 11 percent who said they would advise against taking one out, as opposed to 7 percent who said they would recommend student loans to others.
In all, the survey’s results showed that American consumers’ financial knowhow was not always up to par with their confidence. “These findings portray a bigger picture of the financial literacy knowledge Americans lack today,” concluded NerdWallet personal finance analyst Clifford Goldstein in a statement.