“The path to financial wellness is rarely linear. Inevitably, there will be setbacks, which often present new opportunities to course correct. The important thing to remember is there are small steps you can take today—like checking your account balance—that will propel you forward to create a healthy, sustainable and resilient financial future,” said
The findings revealed financial “faux pas” related to budgeting are the most common type of money misstep, followed by savings, debt management, investing, and insuring. For example, nearly half (47%) of consumers who committed a budgetary “faux pas” reported they had fallen victim to sudden spending whims more often than other types of budgeting “faux pas,” such as spending beyond their means or paying for subscription services that go unused.
Additionally, among those who made savings “faux pas”:
- 1 in 3 respondents didn’t save for an emergency.
- More than 1 in 4 admit to spending their tax return.
- More than 1 in 5 admit to not contributing to retirement savings.
“The truth is not all ‘faux pas’ are created equal,” continued Cotla. “Some false steps with finances may be common, but that doesn’t mean they aren’t serious. In fact, 1 in 3 consider not saving enough/waiting too long to save for retirement to be the most severe of financial ‘faux pas.’ If not addressed promptly, such missteps can be a slippery slope.”
Financial Confidence Does Not Equal Immunity to Budgeting Missteps
Interestingly, despite feeling more confident in their financial know-how, younger generations more often have budgeting issues compared to older generations. For example, 1 in 5 Millennials consider themselves a financial expert, compared to fewer than 1 in 10 Baby Boomers. Additionally, 1 in 3 Millennials who committed budgeting “faux pas” reported feeling afraid to check their bank account, compared to 1 in 5 Gen-Xers and just 1 in 10 Baby Boomers.
Bouncing Back from Financial “Faux Pas” May Take Less Time Than You Think
The good news is a large majority of respondents who committed a financial “faux pas” (89%) feel they can recover within five years. In fact, most people (59%) prefer to face their financial “faux pas” head on. Those who have made a financial misstep will either turn to their spouse/significant other or a family member for support (48%), investigate online resources (26%) or seek counsel from a banker/financial advisor (22%). However, 22% don’t talk to anyone because they’re either too embarrassed or aren’t sure who to talk to.
“Don’t overlook the resources at your disposal, especially when you have the option to build a financial team with your banking partner. With the help of Key’s
In fact, 65% say they are most likely to take these three steps to prevent money mistakes in 2020:
- Identify and prioritize “needs” vs. “wants” (30%)
- Determine a monthly budget and revisit on a weekly basis (22%)
- Educate themselves through financial literacy courses (13%)
Continued Smith, “We’re here to help you move forward on your financial wellness journey, wherever you are along the way. We encourage everyone to set up an appointment with their local
For additional information, articles and tips on getting your financial life in shape, visit www.key.com/resolutions
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