Though wages are growing and inflation is cooling, more Americans are getting anxious about their money, latest research shows.
Half of Americans now report that the general state of the economy in addition to their very own personal funds are their biggest sources of stress, in keeping with a wealth report released Monday by the investment and financial planning firm Edelman Financial Engines.
“There’s no doubt that the economic and social pressures Americans have faced lately continued to mount in 2024,” the authors wrote. “Money issues still loom large as a top source of stress.”
Specifically, 48% of respondents told Edelman that their personal financial situation was their biggest source of stress, a rise from recent years. In 2023, 46% rated that as a top stressor, and in 2022 — the primary 12 months of Edelman’s survey — 43% said the identical. The newest report was based on responses from over 3,000 Americans not less than 30 years old.
No money worries: How much income wouldn’t it take?
This 12 months, Edelman asked respondents how much they would wish to earn to not worry about on a regular basis living expenses.
About 6 in 10 Americans reported that they would wish a salary of not less than $100,000 to stop stressing a lot about money. For 1 / 4 of respondents, it might take greater than $200,000.
Most Americans earn nowhere near those amounts. For reference, median earnings within the U.S. for 2024 are about $60,000.
Particularly, younger Americans were much more likely than older ones to say they would wish a six-figure salary to calm their money anxieties. For instance, 71% of 30-somethings said they’d require not less than $100,000, and a 3rd of respondents in that age group cited $200,000 or more.
Apart from basic peace of mind, Edelman also asked about how much money it might take to “feel wealthy.” Some 65% said not less than $1 million, and 19% said not less than $5 million. Only 12% of respondents said they consider themselves wealthy immediately — a dip of two percentage points from last 12 months.
The general public’s souring mood on their funds runs counter to many headlines concerning the state of the economy.
Over the past few years, inflation dropped from its 9.1% peak in June 2022 all the way down to 2.5% last month. To date this 12 months, wage growth has comfortably outpaced inflation, averaging about 5% every month. The Federal Reserve just delivered its first long-awaited rate of interest cut, making borrowing money a little bit more cost-effective for consumers and sending a transparent signal that the nation’s central bankers consider inflation is subsiding.
Still, people’s financial anxiety is persisting — and even growing. That’s likely attributable to the cumulative effect of inflation, or in other words, the totality of price hikes because the start of COVID-19 crisis.
“For consumers, 2%, 3%, 4% don’t really mean anything,” Sofia Baig, an economist at Morning Seek the advice of, recently told Money. “What they’ve experienced is definitely around like a 20% increase in prices because the pandemic, which is form of shocking.”
To her point, Labor Department data shows that the general cost of living has skyrocketed nearly 22% since March 2020. The fee of housing — one among Americans’ biggest monthly expenses — has run even hotter, at about 24%.
“Inflation has been the dominant concern across America,” the Edelman report states. “Even in 2024, it stays on the forefront of Americans’ minds.”
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