Two-thirds of respondents say work-life balance is more important than a high-paying salary
The KeyBank 2022 Financial Mobility Survey, released , finds many Americans are reconsidering their work and financial priorities, with two-thirds (62%) of respondents indicating that work-life balance is more important to them than a high-paying salary (22%). While the desire for greater work-life balance exists, only a quarter (25%) of Americans say they have experienced an improvement in their standard of living compared to 2020. These findings highlight a shift in mentality as Americans take steps to overcome obstacles and re-align priorities for financial mobility.
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The survey polled more than 1,000 Americans on their financial and work-related priorities after nearly a year of living through a pandemic, revealing the steps they have taken to become more financially mobile:
- Two in 10 Americans (22%) have made a career shift since COVID-19 began, aligning with ‘The Great Resignation’ that has defined 2021. Most commonly, Americans chose to retire (22%) or leave for a different role (21%). Those who shifted roles were predominantly younger, with an average age of 37.
- Nearly half (46%) of respondents say the pandemic has altered their financial priorities and 49% say it has led them to think more about how to grow their finances—especially those who self-identify as “financial experts” (80%).
- Among those who faced notable challenges this year (37%), three-quarters are confident in their ability to grow their finances. This represents a higher percentage than those who did not face notable challenges.
Mental Health Rises to the Forefront
After confronting the hardships brought on by the pandemic, many Americans shifted their priorities to allow more time for themselves and their loved ones, while still focusing on financial health and building financial resilience.
While nearly half of Americans say financial information (48%) and digital banking (39%) are top areas that make them feel more financially resilient, respondents are placing greater emphasis on activities that support mental health this year, compared to last. This includes getting a good night’s sleep (43%), the second-highest factor impacting financial resilience, up 5% since last year.
Additionally, respondents say open communication with their partner or significant other (35%), proper diet and exercise (30%), personal connections (24%) and daily mindfulness exercises (24%) are all factors that lead to feeling financially resilient. In fact, the survey revealed increases in the number of Americans citing these factors as critical to their financial wellbeing, with an average increase of 7.2% across these board, compared to 2020.
“The pandemic has led many Americans to redefine personal and financial priorities and place greater emphasis on activities that will inspire a sense of health and wellbeing in both mind and wallet,” said Mitch Kime, Head of Consumer Lending & Payments at KeyBank. “For many, financial mobility isn’t solely driven by the number on their paycheck. Instead, Americans are taking a more holistic approach to financial health by honing the skills, forging the relationships and cultivating the mindfulness needed to make financial decisions that align with their values and will empower them to live more fulfilling lives.”
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“Financial Experts” Are Also Risk Takers—and It Pays Off
Survey respondents who self-report their financial savviness as “expert”-level are also more likely to say they have made a “financial faux pas,” or a financial misstep—highlighting a connection between financial experience and confidence. Despite these missteps, taking risks may translate into confidence, as individuals are able to learn and grow their financial skills and know-how for the future.
Notably, eight in ten (79%) financial experts say they have made a financial faux pas—more than any other group. This group is also more likely to identify with a “you only live once” (YOLO) financial attitude (34%), than cautiously optimistic (32%) and playing it safe (31%).
Financial experts’ top three financial faux pas include spending their tax return instead of saving it, reacting to market volatility, and relying on non-experts to make decisions. Seven in ten (71%) financial experts are very confident in growing their finances compared to only 6% who say they are not confident.
“We’ve all heard the saying, ‘the higher the risk, the higher the reward,'” says Kime. “However, while those who take financial risks are experiencing higher levels of confidence, the true reward often emerges from reflecting on those missteps in the company of a trusted financial advisor and working collaboratively to put together a strong financial plan that aligns with one’s goals for the future.”
Lower Incomes Lead to Less Perceived ‘Savviness’
In a year marked by a shift toward social justice and equity, it’s notable that Americans with lower incomes are still reporting less financial savviness and confidence across the board, compared to those with higher incomes—likely due to social determinants of financial mobility.
Nearly four in ten (38%) Americans who make less than $25,000 per year report being “not financially savvy,” compared to the 15% of Americans make between $50,000 – $99,000 in annual salary who report the same, indicating a direct correlation between income and perceived savviness.
And yet, it’s Americans who are making less than $25,000 annually who report spending more and saving less in the past year (18%). This makes sense, as Americans with greater incomes may have had the luxury of pulling back on discretionary expenses, while those with lower incomes may have needed to continue spending the same portion of their earnings on essentials.
Financial Information Bridges the Gap
Despite the disparities in perceived financial savviness and financial confidence, Americans across the board report that the number one thing that made them feel financially resilient during the pandemic was financial information (48%). This access to financial information has empowered Americans over the past year, with about half reporting that they have become more financially aware due to challenges faced in 2021.
To protect from financial faux pas, most Americans report that they identify and prioritize “needs” vs. “wants” (29%) and determine a monthly budget to revisit on a weekly basis (24%). Access to financial information is crucial to making these spending/budgeting determinations.
Financial institutions can play an important role in supporting and enabling financial mobility by offering tools that give Americans greater access to their financial information – for instance, products like the Secured Credit Card and Hassle-Free Checking help Americans build credit and learn about their finances.
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