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Monday, March 4, 2024

Over 130 Million Americans Suffer From Unmanageable Money Stress

Money Stress Study
Ashley Fricker

Written by: Ashley Fricker

Ashley Fricker
Ashley Fricker

Ashley Fricker has more than a decade of experience as a finance contributor and editor, and has specialized in the credit card industry since 2015. Her credit card commentary is featured on national media outlets that include CNBC, MarketWatch, Investopedia, and Reader's Digest, among many others. She has worked closely with the world’s largest banks and financial institutions, up-and-coming fintech companies, and press and news outlets to curate comprehensive content and media. Ashley holds a bachelor's degree in multimedia journalism from Florida Atlantic University.

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Edited by: Lillian Guevara-Castro

Lillian Guevara-Castro
Lillian Guevara-Castro

Lillian Guevara-Castro brings more than 30 years of editing and journalism experience to the CardRates team. She has written and edited for major news organizations, including The Atlanta Journal-Constitution and the New York Times, and she previously served as an adjunct journalism instructor at the University of Florida. Today, Lillian edits all CardRates content for clarity, accuracy, and reader engagement.

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Reviewed by: Jon McDonald

Jon McDonald
Jon McDonald

Jon leverages 15-plus years of journalism expertise to inform financial consumers about emerging trends and companies making an impact in the industry. He is most knowledgeable in the areas of budgeting, credit card rewards, and responsible credit use. Jon has a passion for writing and editing, and his articles have appeared in publications produced by The New York Times.

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In a groundbreaking survey conducted recently, we reached out to 3,000 Americans from various walks of life to delve into a pressing issue that affects countless individuals nationwide: financial stress. The primary objective of this survey was to uncover the prevalence of Americans who not only experience financial stress, but also perceive it as unmanageable, overshadowing their daily lives. 

This exploration aims to shed light on the silent struggle many face in balancing their financial responsibilities, hoping to initiate a broader conversation about the societal and personal impacts of this often unspoken burden.

The survey’s findings revealed a staggering reality: Approximately two-thirds of the participants, translating to more than 130 million adults in the United States, reported feeling overwhelmed by financial stress. This data highlights a widespread concern about money management and financial stability across the nation.

83% of Vermonters Report Unmanageable Stress Levels 

The situation in Vermont is particularly alarming when we compare the results by state. An overwhelming majority, about 83% of respondents, acknowledged experiencing unmanageable levels of stress due to financial concerns. This figure is notably high and indicates a significant financial wellness issue among Vermont’s residents.

In contrast, Idaho presents a different picture. Known as the Gem State, only 25% of its residents report feeling burdened by financial worries. This lower percentage suggests that Idahoans, on average, may be experiencing less financial stress compared to the rest of the country, or they may have more effective strategies for managing their financial concerns.

The table below shows the number of individuals in each state who acknowledge experiencing such financial stress:

The sensation of financial stress being unmanageable often stems from a confluence of factors, both external and internal. Externally, the relentless pace of economic changes, such as the rising cost of living, stagnant wages, and unpredictable job markets, can make financial stability seem like a moving target, difficult to achieve or maintain. 

Internally, there is often a lack of financial literacy, which leaves many feeling ill-equipped to navigate complex financial decisions or unexpected expenses. Additionally, societal pressures and the stigma associated with discussing money problems can lead to a sense of isolation, exacerbating the stress. 

This combination of relentless economic pressures and personal uncertainties creates a perfect storm, where financial challenges feel not just daunting but completely overwhelming, leaving individuals feeling trapped in a cycle of fiscal anxiety.

Additional Findings

Our survey also discovered that personal financial stress has affected over half of the relationships throughout America.

59% of personal relationships suffer due to financial stress.

Personal finance stresses often have a profound impact on relationships, as the constant worry and tension over money matters can lead to frequent conflicts and a breakdown in communication. The strain of financial instability can overshadow the joy and trust in partnerships, fostering an environment of uncertainty and resentment that challenges the very foundation of relationship bonds.

Moreover, the ripple effects of personal finance stresses extend beyond intimate relationships to impact family and friends as well, with 66% of respondents admitting their stress has had an impact on their family and friends. 

When family members face financial difficulties, it’s common for relatives to feel a strong sense of obligation to lend a helping hand, often in the form of financial support. This well-intentioned act, however, can lead to complex and sometimes unintended consequences. 

Lending money within the family circle often blurs the lines between personal relationships and financial transactions, creating the potential for tension and misunderstandings. The expectation of repayment, when mingled with familial bonds, can lead to strained relationships, especially if the borrower struggles to fulfill their repayment obligations. 

Over time, this dynamic can erode trust and communication within the family, potentially leading to long-lasting rifts. Furthermore, if lending becomes a pattern, it may inadvertently encourage financial dependency, hampering the borrower’s motivation or ability to manage their finances independently.

But it’s not all doom and gloom. Our survey also revealed that on a scale of 1 to 10, Americans rated their confidence at a 6 when it came to their abilities to manage their financial stress. 

Americans rate their ability to manage financial stress a 6 out of 10

In fact, 82% of respondents said that if they suffer money worries, they proactively seek a solution rather than waiting for things to fix themselves. 

Tips For Managing Money Stress

While financial stress can be overwhelming, there are effective strategies to manage it and prevent it from taking over one’s life and affecting personal relationships. 

  • First and foremost, gaining financial literacy is crucial; understanding the basics of budgeting, saving, and investing empowers individuals to make informed decisions.
  • Open communication about financial struggles, both with family and a financial advisor, can alleviate the burden and pave the way for practical solutions. 
  • Setting realistic financial goals and creating a clear plan to achieve them can provide a sense of control and direction.
  • Additionally, practicing mindfulness and stress-reduction techniques, such as meditation or exercise, can help maintain emotional balance. 

By taking these proactive steps, individuals can not only navigate their financial challenges more effectively but also preserve and strengthen their cherished relationships.

Methodology

CardRates conducted a panel survey of 3,000 adults based on age, gender, and geography. Internal data sources were used to obtain population data sets. We used a two-step process to ensure representativeness through stratified sampling and post-stratification weighting. Completed February 2024.