How the Financial Crisis Changed America

Today I read an article from the folks at Fidelity Investments. They completed a study in February called The Fidelity Five Years Later study—referencing five years after the financial crisis began.

The participants represented adults over twenty-five years of age, financial decision makers who have investments so they were above average in their financial commitments, as I am sure are those reading this blog.

The Crisis and Financial Attitudes

Here are some of the results I think you will find interesting:

  • 42% have increased participation in workplace retirement and health savings plans
  • 55% feel better prepared for retirement
  • 42% have increased emergency fund savings
  • 80% have a better understanding of their finances
  • 49% have purposely decreased personal debt
  • 72% have less debt now than before
  • 78% say they have made permanent behavior changes

What Do These Results Mean?

As you look through this list I think you will see many reasons to be hopeful for the future, at least among the people surveyed. If these attitudes are prevalent among the population as a whole I think it is a good sign for the future of America.

It is interesting to note that in this study there was a basic division between those who considered the primary cause of the crisis to be the banks/financial institutions and those who saw primary responsibility with individuals. Personally, I think they would have found it to be a three way division if they had included the responsibility of the government as a third option.

It is also interesting that while a lot of people have consciously worked at reducing debt, many more have less debt now than they did before. This is probably due to the fact that whenever you start focusing on any aspect of financial achievement you will naturally take steps to move away from debt because it becomes evident that debt obligations are a major hindrance to reaching all other financial goals.

Look at the results of this study and think about your own changes in financial behavior over the last few years. How do you compare?

Crisis and Financial Change

Fidelity concludes, rightly I think, that one clear benefit of the financial crisis is that many Americans are now more focused on their financial lives. A vast majority of participants in this survey believe that they have made permanent changes. The real test of this will take time to prove. I hope it will stay true. I also hope it is true for the broader population.