#Strategy : Losing Sleep? Your Wallet Is To Blame…84% Feel That They are Not in Control of their Current Financial Situation. Nearly 75% of All Adults are Losing Sleep Over Some Sort of Money Woe.

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“I Think Part of the Challenge is There Hasn’t Been Real Growth in Incomes, The Cost of Groceries, Cost of Healthcare, etc, Those Kinds of Expenses have a Normal Inflationary Increase, But I Don’t Think Wage Increases have Kept in Line.” (Indeed, while the U.S. job market has been adding jobs in recent months, wage growth has been tepid, to say the least.) – Greg Ward, a Certified Financial planner & Financial Finesse’s Think Tank Director,

62% of Americans are losing sleep over money woes.

The job market is showing signs of improvement, gas prices are down and the market is still in its bull run. Yet despite this relatively rosy environment, Americans are seriously stressed about money. 84% feel that they are not in control of their current financial situation. Nearly 75% of all adults are losing sleep over some sort of money woe. And 69% of younger adults would give up the internet for one month just to get $1,000.

These statistics come courtesy of three new studies, all released this week, that looked at the state of savings, spending, and financial stress in the U.S. All three studies found that while Americans aren’t totally floundering when it comes to managing their household finances, they’re feeling under-confident and over-stressed when it comes to what’s in (or, in some cases, not in) their wallets.

The first study, released by Capital One 360 on Tuesday, revealed that 54% of Americans Feel Happy When They Save Money, Yet 36% of Respondents told Capital One that their income is Not High Enough to Allow for Saving. It was Capital One that also discovered that a whopping 69% of young adults (ages 18 to 24, roughly) would give up their home internet connection for a month in exchange for a $1,000 deposit into their savings account.

A second study, released on Wednesday by financial education company Financial Finesse, both echoed many of Capital One’s findings and provided a deeper look at certain segments of Americans — particularly, low-to-moderate income Women who Have Kids under the age of 18. 85% of this group, Financial Finesse found, are experiencing high or overwhelming levels of financial stress.

 

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“I Think Part of the Challenge is There Hasn’t Been Real Growth in Incomes,” Greg Ward, a certified financial planner and Financial Finesse’s Think Tank director, said in a recent phone interview. “The Cost of Groceries, Cost of Healthcare, etc, Those Kinds of Expenses have a Normal Inflationary Increase, But I Don’t Think Wage Increases have Kept in Line.” (Indeed, while the U.S. job market has been adding jobs in recent months, wage growth has been tepid, to say the least.)

Interestingly, while 84% of respondents told Financial Finesse that they feel like their financial situation is out of control, one segment of adults feel perfectly cool, calm and collected when it comes to their money: men under 30. Twenty-six percent of this group told Financial Finesse that they have no financial stress whatsoever, with 84% reporting they have a handle on cash flow (compared to 66% of women under 30 who say the same), 69% saying they feel comfortable with their debt (compared to 51% of women under 30 who feel comfortable with their debt), and 46% feeling confident about their investment decisions — double the proportion of women under 30 who would say the same thing.

But just because men under 30 say everything with their money is hunky-dory doesn’t mean that that they’re financial whiz kids.

“Remember, stress is self reported, and these individuals could have the same financial challenges [fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”][as others], but it doesn’t necessarily translate into the same levels of self reported stress,” Ward noted. In other words, it’s a matter of perspective. One person with a $7,500 student loan at a 4.66% interest rate might feel terrible with that debt on their personal balance sheet, while another person with that exact same loan might easily think, “Yay! That’s my only debt and it’s at a relatively low interest rate; I’m doing great!”

(It also might be the innocence of youth speaking: a recent study from financial planning firm LearnVest revealed that our financial confidence is high when we’re in our 20s but starts to sink when we hit our 30s and bottoms out by our 40s.)

A third study, out Thursday morning from CreditCards.com, confirms that Millennial men are in the minority when it comes to feelings of financial contentment. And in fact, not only do most Americans feel uneasy about their finances, money is keeping lots of people up at night: CreditCards.com reports that 62% of adults are losing sleep over at least one financial problem. This is seven points lower than in June 2009, the last time the poll was conducted, but it’s still higher than the 56% who reported money-induced insomnia in 2007.

Retirement is, currently, the biggest culprit of lost sleep, with 40% of all adults saying that insecurity over the size of their nestegg keeps them up at night occasionally; among adults ages 50 to 64, that number is 50%. But gaining on retirement’s lead is stress of education expenses: 31% of all adults report losing sleep over the idea of paying for educational expenses, either their own or someone else’s; among adults ages 18 to 29, that number jumps to 50%.

“The biggest change over the past eight years has been the steady increase in the number of people losing sleep over educational expenses,” Matt Schulz, CreditCards.com’s senior industry analyst, said in a statement accompanying the study. “That’s the only one of the five categories that has gotten worse since the Great Recession. Unless something slows the rapid rise in college costs, this could soon be Americans’ biggest financial fear.”

While stress in general is neither healthy nor fun (and tips on reducing financially-induced stress can be found here), Financial Finesse’s Ward says that, at the end of the day, a little bit of uneasiness might actually be a good thing.

“Having no stress is not necessarily an ideal situation. My house might not be on fire, but there might be a fire in the bathroom — something little that could become bigger later on,” he says. “If you say, ‘I don’t have a care in the world,’ there might be a reality check that needs to occur.”

 

Forbes.com | 6-25-15 | Maggie McGrath 

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