The stock market has been surging all year, but as investors enter the ninth year of the bull market in the U.S., the number of people making financial resolutions for 2018 is at an all-time low in Fidelity Investments ninth annual New Year’s Financial Resolutions Study.
While the reasons for a lack of financial resolutions varies, a sense of inertia appears to have set in, with many investors less worried about their portfolio than they are about other areas of their lives. “There’s a bit of a feeling that I had my financial resolutions for a couple of years when the market wasn’t so great, but now that’s not my primary focus,” said Maura Cassidy, Fidelity vice president, retirement, in an interview with Investopedia. “The actions put in place in the last couple of years are allowing them to skip a year of financial resolutions.”
[Ally Invest offers powerful charting tools and $4.95 trades. Read Investopedia’s Ally Invest review to learn more about this low-cost broker.]
Fidelity Investments found in its latest survey that only 27% of respondents plan to make a financial resolution for 2018. That is down from 43% in 2014, which was the highest number recorded in the survey. Of those that have a resolution, the brokerage found that a larger percentage of respondents intend to save more than they did in 2016. Of those respondents, 66% feel that they are in a better financial position to save more. Among millennials, nine in ten said that they will be better off from a financial perspective next year. Furthermore, 43% of those polled said that they will increase their retirement savings rate by 1% or more of their salary next year, while 62% of millennials said they will increase it by at least 1%.
What’s more, 54% of respondents plan to beef up their emergency savings – prompted to do so as a result of the recent spate of natural disasters. Among the savers, more than half, or 54%, said they are putting away money for the long haul, while 38% are focused on short-term saving. That’s a shift from last year, when 62% of survey respondents indicated that they were focused on long-term saving, while 32% were saving for near-term goals.
According to Fidelity, while inertia is setting in, one significant reason that some respondents do not let that happen is financial stress. Fidelity’s study shows that 38% of survey respondents are stressed about finances, with debt, expenses and saving as the top culprits. “While everyone feels they are in a better financial position, it’s not the time to let off the gas,” says Cassidy. “Leverage some of that established better savings and better investing to be ready for what the future brings, good and bad.”