A new investigation carried out by Edelman Financial Engines indicates that almost 60% of people in the U.S. think that an annual salary of $100,000 would help reduce their worries about daily expenses. This belief is even more prevalent among those in their 30s and 40s, with 71% and 75% respectively identifying $100,000 as the necessary earnings to relieve their financial burdens. The research, entitled “Everyday Wealth in America,” consisted of a survey involving 3,000 Americans aged 30 and above, including 1,500 “affluent” participants aged 45-70, conducted between June 12 and July 3.
The results offer a glimpse into the financial concerns of Americans amid ongoing high inflation and escalating living expenses. Edelman Financial Engines further noted that for about one-quarter of the American population, an income of $200,000 was deemed essential to eliminate stress regarding routine expenditures. In August, the Consumer Price Index reported a 0.2% increase month-over-month and a 2.5% rise year-over-year.
This represents the least amount of increase over a 12-month period since February 2021. Nonetheless, the costs related to food and housing remain significant challenges for U.S. consumers, with food prices rising by 2.1% and housing costs escalating by 5.2% compared to the previous year. The research also pointed out that only 12% of Americans consider themselves wealthy.
Income required to reduce anxiety
Additionally, nearly two-thirds of individuals not self-identifying as wealthy suggested that having $1 million would alter their viewpoint. Approximately 44% of the population regards credit card debt as the primary obstacle to their wealth accumulation.
Amin Dabit from Edelman Financial Engines commented, “Americans aren’t feeling particularly confident about their financial situations. These concerns arise from outside pressures, such as inflation, along with personal challenges like family obligations and increasing credit card debt.
The poll also revealed that prioritizing emergency savings, wealth accumulation, and retirement preparation are the top three financial objectives for Americans this year. In general, the economy and personal financial matters significantly contribute to anxiety, with 49% indicating the economy as their “greatest source” of stress and 48% pinpointing personal finances.
Politics emerged as a notable source of anxiety for 37% of survey participants. As Americans face these financial hurdles, insights from studies like those from Edelman Financial Engines provide essential perspectives on the financial health of the nation. The rapid increase in living costs during the pandemic has likely shifted perspectives regarding the income necessary to stop fretting about bill payments.
Isabel Barrow, the director of financial planning, remarked that a six-figure salary is increasingly perceived as foundational for financial security rather than a symbol of wealth or accomplishment. She cautioned against allowing politics and emotions to dictate financial choices, as altering investment strategies based on potential future events could result in lost opportunities.
