Empower, a new survey company, has set a high standard for financial success. A net worth of $5.3m and an annual income of 233,000 dollars are now considered benchmarks to achieve economic prosperity.
According to the Social Security Administration however, these figures are not within reach of most Americans. The typical salary in 2023 will be around $67,000.
This stark disparity highlights a growing gap between financial expectations and reality, particularly in an economic year marked by inflation, economic instability, and shifting priorities.
Despite these lofty financial expectations, less than 40% of respondents considered themselves to be financially successful. Nearly half expressed doubts that they would reach their ideal financial goals.
The main barriers to success include economic instability (35% of respondents) as well as inconsistent income streams (30%). This highlights the difficulties many Americans face when balancing their daily expenses with their long-term financial goals.
The average 401(k), for example, at Fidelity Investments was just $127.100, which is far below the multimillion dollar net worth that respondents associate with success.
The high cost of home ownership is another factor that prevents many from achieving success financially.
Many Americans are finding it difficult to enter the housing markets due to rising interest rates and sky high property prices. This has exacerbated financial inequality and made the idea of financial success unattainable.
The survey also revealed, in an interesting way, that financial success doesn’t necessarily depend on specific monetary thresholds.
43 percent of participants don’t think success is based on a specific financial figure. Nearly 60% of participants consider happiness to be their primary measure of success.
Happiness for these individuals is defined by the ability to spend money on things and experiences which bring them joy.
Over a third of respondents emphasized the importance of physical well-being and having free time.
The differences between generations also played a part in defining success financially.
The younger generations are more likely to place greater emphasis on personal fulfillment and free time, while the older generations are more likely to place greater emphasis on wealth accumulation and financial security.
This generational divide reflects an overall shift in attitudes towards work-life balance, financial planning and the aftermath of the pandemic.
Many Americans are experiencing increasing financial anxiety due to rising inflation, interest rate increases, and uncertainty in the job market.
Nearly half of the respondents expressed doubts about their ability to achieve their financial milestones. This highlights the need for policy changes aimed at improving wage increases, affordability and access to financial resources.
The survey, which included 2203 respondents from across the US, paints an intricate picture of financial success, one that blends traditional monetary aspirations with non-financial goals like health, happiness and leisure.
This post Survey reveals that $270K salary is seen as the key to financial success for many Americans, but many fall short of it may be updated as new developments unfold.
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