This issue’s Research Brief will summarize the general session. Dr. Billy Hensley, President and CEO of the National Endowment for Financial Education (NEFE) presented this session. NEFE did a series of surveys in the spring (April) and fall (September). NEFE’s goal was to capture the financial concerns and economic ripple effect of this pandemic on households’ finances.

Financial Stress

As of September, 84% of those surveyed reported feeling financially stressed. In the initial survey, 88% felt financially stressed. Eighty-four percent is still an extremely high number of Americans experiencing financial stress. Those who reported being extremely/very concerned also fell from 43% to 34%. However, concern does go up for ethnic groups (30% white, 40% Black non-Latino, and 45% Latino).

The survey asked respondents what their top five stressors were regarding their personal finances. Many respondents (41% pre and 40% post) indicated having enough money in savings. Thinking about how long it takes to save up an emergency fund and then losing it due to the pandemic, can cause a lot of stress and anxiety. It’s not just about the bottom line (finances) but the emotional toll this takes on a person.

Other top stressors were:

  • job security,
  • having enough saved for retirement,
  • income fluctuations,
  • making rent or mortgage payments,
  • paying utilities,
  • debt repayment,
  • health care bills,
  • financial market volatility, and
  • putting off major financial decisions

Three of these items actually increased percentages between April and September, meaning that more people were concerned with these items six months into this pandemic. These items were having enough saved for retirement, paying health care bills, and putting off major financial decisions.

Financial Future

In September, over one-third (39%) of people worried about their financial situation 12 months in the future. 41% worried about their financial future in April. On the other end of the spectrum were those who were very or somewhat optimistic. In both survey waves, 34% indicated optimism.

People are adapting and taking steps to adjust their finances due to the pandemic with 75% in April and 74% in the September survey indicating making changes. Eighteen percent tapped into emergency savings, 7% borrowed against retirement, 11% plan to defer bill/debt payments, and 11% have taken on more credit card debt. These adjustments will have lasting negative impacts on these consumers. Making financial adjustments was more prevalent among non-white ethnic groups (70% white, 86% Black non-Latino, and 74% Latino).

Supporting Others

Respondents also indicated that they were providing support to family and/or friends during COVID with 84% indicating that providing assistance has caused some strain. Thirty-one percent also indicated that they have received monetary and non-monetary support from others. This survey shows that the pandemic produces sustained financial impacts. Further, these impacts are both direct and indirect. As a community of financial professionals, we are in a unique position to help build more positive outcomes. We educate, council, and coach people facing financial hardships. This study provides valuable insights to our community to gather information related to what consumers are facing. This will help us target those that need the most assistance and modify our materials/information to meet their needs.

To find more information related to this study, visit NEFE’s website Here you can find a full summary, the complete survey, and press release. You can also listen to the AFCPE Real Money Real Experts podcast with Dr. Hensley from September 29, 2020.

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