You know Your Survival Guy’s long history with Fidelity. Going into 2025, it’ll be decades of involvement with Fidelity, either as an employee for a brief time, or using Fidelity as custodian of client accounts for many years. As the world heads into another year, Fidelity has polled investors for its sixteenth annual “New Year’s Financial Resolutions” study, and found that many investors are worried about unexpected expenses and inflation, as well as the economy and savings. Many are making emergency savings a priority. The report reads:
Emergency Savings Rising as a Top Area of Focus
Part of this focus on living sensibly can be attributed to the fact that more than half (53%) of Americans feel overwhelmed by their personal finances and nearly one-third (30%) describe their relationship with money as stressful. When thinking about last year’s financial resolutions, among those who were unsuccessful in keeping them, 39% were not able to stick to it because they had less money due to inflation’s impact on day-to-day expenses.
Compared to recent years, many Americans are also feeling more stressed about their:
Ability to pay monthly bills (35%)
Having money left over to save for other goals after paying monthly bills (36%)
Ability to pay down debt (33%)
Having enough retirement savings to retire as planned (32%).
This stress is understandable, when one considers the fact that nearly 3-in-4 Americans (72%) report experiencing a financial setback this year. To handle setbacks, nearly half (46%) were forced to dip into emergency savings at some point over the last year. The women who had an emergency savings fund to dip into were fortunate, as significantly more women (30%) than men (19%) indicated they didn’t have an emergency fund to dip into at all.
Furthermore, one-in-five respondents (20%) say having an unexpected non-health emergency – like a car repair or home repair – could set them back financially in the coming year. With this in mind, perhaps there’s no surprise that 79% of respondents plan to build up their emergency savings – most notably 80% of women.
Resolving to Be Different in 2025
Of those Americans considering a financial resolution in the year ahead, the top resolutions remain consistent with years past: save more money (43%), pay down debt (37%), and spend less money (31%).
Among Americans considering ‘save more money’ as one of those financial resolutions, most are focused on short-term savings goals in the coming year – including credit card debt, emergency savings, mortgage payments, and big-ticket purchases – more than long-term goals (including retirement, college savings, health care, and long-term care) (55% vs 45%). This is a shift from the 2024 study, where long-term goals were more of a top priority for respondents. Fortunately, recent Fidelity data on workplace retirement savings suggests that, at least so far, this increased focus on short-term financial goals is not coming at the expense of long-term savings.
The good news is that the majority of respondents (72%) have a plan in place for reaching their financial goals. In fact, most Americans believe having a financial plan can help them to better deal with the unexpected (80%) and have learned to practice mindful spending and saving habits (78%).
Action Line: Financial resolutions are a good way to motivate yourself to beat inertia. Ultimately though, you need a financial plan, and someone to help you achieve the goals in that plan. When you’re ready to talk about your plan with someone who wants to help you, email me at ejsmith@yoursurvivalguy.com. In the meantime, click here to subscribe to my free monthly Survive & Thrive letter.
