Americans want control over their money, but confidence is the missing piece
Americans want to be more engaged in their financial lives, but mounting economic pressures and uncertainty are making it harder to navigate their finances with the right level of confidence, according to new research released by Edelman Financial Engines (EFE).
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“Throughout EFE’s 40-year history, we’ve seen that financial confidence is about more than money – it’s about having the clarity and perspective to make financial decisions that are right for you.”
The inaugural Financial Confidence Report examines the forces shaping how Americans think, feel, and act when it comes to their money – and identifies a Financial Confidence Gap between their desire to take control of their financial future and their confidence in making the right financial decisions for themselves.
“Throughout EFE’s 40-year history, we’ve seen that financial confidence is about more than money – it’s about having the clarity and perspective to make financial decisions that are right for you,” said Ralph Haberli, CEO and President of Edelman Financial Engines. “This research reinforces that fact, along with the importance of having trusted advice and guidance to help navigate the increasing complexities of our world.”
The report challenges the notion that financial confidence is something people either have or they don’t. It also underscores that more confidence isn’t necessarily better because too much confidence can lead to financial mistakes. Confidence exists on a spectrum and can shift over time, across life stages, and even from one financial decision to the next. Today’s mix of market uncertainty, rising costs, and an influx of financial information brings that dynamic into sharper focus.
Among the report’s findings:
- Nearly 85% of Americans want to play an active role in retirement planning and savings decisions.
- Yet, only 40% of workplace retirement plan participants say they know exactly how their retirement savings are invested.
- Nearly half of Americans are stressed, with money concerns being a leading driver.
- The Financial Confidence Gap is prevalent across financial behavior, from investing and retirement planning, to major purchasing decisions.
“Americans are navigating an environment where the signals about their financial lives don’t always point in the same direction,” said Michael Liersch, Chief Planning Officer at Edelman Financial Engines. “On paper, they may look financially strong, but their day-to-day experience tells a different story. That tension can make it harder to know where you stand and approach financial decisions with the right level of confidence.”
The findings underscore the value of understanding your full financial picture, recognizing what you don’t know, and having trusted guidance to help put financial decisions into context.
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