A new survey reveals that more than three-quarters of Americans have a financial regret, as ongoing inflation continues to drive up prices on many goods and essentials.
Bankrate surveyed more than 2,300 U.S. adults online between July 16-18 2024.
According to the survey published Wednesday, not saving for retirement early enough (22%) and not saving enough for emergencies (18%) were the top two retirement regrets among respondents.
During 6 of the 7 years of polling, the top financial regret Americans cited was not saving early enough for retirement. Similarly, emergency savings has also been a consistent top financial regret, coming out on top once, and landing in second or third in the remaining years of polling.
Other financial regrets among Americans included incurring too much credit card debt (14%) and buying more house than they could afford (2%).
Despite this, the survey also found that 40% of respondents have not made any progress on their financial regret in the past 12 months.
“Saving is a lot less painful than dealing with the debt that results when you don’t have it,” said Greg McBride, Bankrate’s chief financial analyst. “Paying down debt means doing without, cutting spending, or working more. Saving for retirement and emergencies can be automated through payroll deduction, direct deposit, and automatic transfers. Start modestly and after a couple of pay periods you won’t miss what you don’t see.”
Inflation continues to be obstacle to Americans’ financial goals
Inflation continues to be a major obstacle to Americans’ personal financial goals, with 45% of those with a financial regret saying inflation and high prices most negatively impacted their progress on their regret in the past year.
After inflation, their employment situation was cited as the main obstacle by 18% of respondents.
Other factors that some cited as having the most negative impact on their progress include high interest rates (9%), family dynamics (7%) and housing market conditions (3%).
“Inflation and high prices are cited as the biggest obstacle to progress in addressing our financial regrets,” McBride added. “Don’t expect an overnight fix. Inflation is moderating, but that doesn’t mean prices are coming down, just that they’re not going up as fast.”
Inflation rate drops in July
The annual inflation rate fell below 3% in July for the first time in over three years, according to the Consumer Price Index (CPI) released by the Bureau of Labor Statistics (BLS).
While Inflation is moving closer to the Federal Reserve’s 2% target, prices remain high on many essentials.
Americans are feeling the strain when it comes to paying usual household expenses, according to another LendingTree survey.
The study found that than 1 in 3 (36.4%) U.S. households said they found it somewhat or very difficult to pay for necessities such as food, rent or other debts. That’s up 6.7% from 34.1% during the same period in 2022.
“It’s troubling that 1 in 3 American households are financially insecure,” said LendingTree chief credit analyst Matt Schulz, “but it shouldn’t be terribly surprising. The perfect storm of record debt, sky-high interest rates and stubborn inflation has resulted in many Americans’ financial margin of error shrinking to virtually zero.”
