A recent study by Empower, a prominent financial services company, reveals that only 37% of Americans currently view themselves as financially successful, yet 58% believe they can achieve financial success in their lifetime. The average annual salary deemed successful by respondents is $270,000, with a net worth goal of $5.3 million.
The research suggests that Americans value happiness as the top indicator of financial success, with 59% prioritizing the ability to spend on joyful experiences and passions. The study also highlights the "Factor of Four," with 84% citing hard work, 65% talent, 55% networking, and 51% luck and circumstance as key components of success. For those earning over $100,000, the belief in hard work increases to 40%.
Rebecca Rickert, head of communications at Empower, notes that people view financial success as a blend of merit and chance, with disciplined and smart money choices at its core. Despite this optimism, nearly half of Americans feel they may never reach their desired success level, and only half believe they will be better off financially than their parents.
The economy, income instability, and lack of financial knowledge are seen as significant barriers to success, with 35% blaming the economy and 30% citing income instability. Setting clear financial goals, avoiding procrastination, and overcoming debt are also considered crucial to achieving success.
Younger generations remain the most hopeful, with 71% of Gen Z and 70% of Millennials expecting to attain financial success, compared to 53% of Gen X and 45% of Baby Boomers. Tangible achievements such as paying bills on time, homeownership, and affording travel are key markers of success for many.
The study also finds that having a financial plan, contributing to retirement savings, and investing in stocks are considered important steps towards greater financial success. One in three people value good financial advice highly.
Empower's report, "Secret to Success," further reveals that a well-paying job, savings, and smart investment choices are considered the surest paths to success. The report also touches on societal pressures, generational differences, and the importance of physical well-being in the context of financial success.
The study, conducted by Morning Consult, surveyed 2,203 American adults and is weighted to be nationally representative. Empower stands as a leading provider in financial planning and retirement services, managing about $1.8 trillion in assets for 19 million investors. For more detailed insights, the full "Secret to Success" report can be accessed on The Currency™, Empower's content platform.
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