Despite government assistance and unemployment increases in the last year, Americans are reporting they are struggling with their financial health. According to a recent MetLife study, financial health is a top concern for consumers in the workforce – more so than their social, physical, and mental health.
These financial pressures continue to be anxiety-producing for many. In fact, nearly 9 in 10 consumers in the workforce say finances are a top source of stress for them now and in the future, and many rank financial health as a top contributor to poor mental health. This uptick in financial anxiety is not only affecting working Americans’ personal lives, but their professional lives, too, as many employers name employee mental health, stress, and burnout as one of the top factors that will have an impact on the workplace of the future.
So, what does this mean for working Americans going forward? With 26 percent of consumers in the workforce seeking solutions and help for stress, burnout or other mental health issues, it is more important than ever to have access to personalized budgeting tools and solutions like UpwiseTM, MetLife’s new financial planning app, that will help make dealing with money matters easier and accessible. The app uses behavioral science to help you identify and address emotional barriers to your financial progress and create better habits that make you feel good about your progress.
Here are the three easy ways you can help ensure a more financially secure tomorrow:
- Personalize your budget to support your needs and wants
According to MetLife’s research, 35 percent of consumers in the workforce say they struggle to pay their bills every month, with 48 percent reporting long-term savings (e.g., such as 401(k)s,
IRAs, or other retirement accounts) as a top cause of financial stress and anxiety. While building a budget may seem overwhelming at first, you can follow simple guidelines like the 50/30/20 rule to help you personalize your budget and determine how much of your monthly income should be spent on needs, wants and savings. Simple steps like this will help you allocate your income in a responsible that allows you to make good financial decisions while still enjoying life.
- Understand how your emotions impact your habits
How does your day-to-day spending make you feel? Identifying your emotions as they relate to your money matters and learning from your spending behaviors can get you closer to financial freedom. In fact, with 41 percent of working Americans saying they are living paycheck to paycheck, understanding your current spending trends and habits can lead to better decision making, including knowing how to prevent and manage issues at hand as well as manage finances with more confidence.
And remember, small changes over time can add up to long-term progress. For example, through tools like the “subscription buster” in UpwiseTM, you can take small steps like reviewing your monthly subscriptions (e.g., streaming services, monthly meal services) and cancel those that are no longer needed or may help you save money.
- Plan now to help prepare for the future
For many, planning around long-term financial goals like retiring on time or putting a down payment on a home can seem overwhelming and sometimes impossible. In fact, according to MetLife’s study, 43 percent of working consumers expect to postpone their retirement due to their financial situation and 35 percent say they occasionally dip into their long-term savings earlier than planned to pay for short term expenses.
Creating a digital estate plan, which can include important documents like your will, a trust fund, as well as healthcare proxies and powers of attorney, for you and your loved ones can also help eliminate confusion and create the organization and structure needed to build and protect your assets. Doing so can greatly reduce your financial stress, and help you feel more confident knowing you have a plan to handle your financial situation and help protect your family’s future.
Financial well-being should always be a priority—especially now amid the quickly-changing pressures of the pandemic. Understanding the emotions that influence your financial decision-making and learning how to take control of your financial future, can help you feel less stressed, more productive, and more focused on what matters. Ultimately, when you feel good about your money, you can thrive now and into the future.
Meredith Ryan-Reid, SVP of Financial Wellness and Engagement at MetLife.