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3 tips to achieve financial resilience in 2024.
New York Life | February 12, 2024
Financial resilience is key for overall financial health — everyone will experience an unexpected expense at some point, some larger than others.
If building financial resilience is one of your 2024 goals, it’s never too late to get started. The below tips will set you up for, not just a year, but a lifetime of success. Focus on nailing the basics now, to create financial resilience for the long-term.
1. Craft a robust financial strategy
The first step to improving your financial health is creating a financial strategy that fits into your lifestyle now while working toward your goals. A financial strategy increases your financial resilience, confidence, and likelihood of reaching your goals. According to New York Life’s 2024 outlook Wealth Watch survey, 83% of adults with a financial strategy say they are similarly or more prepared for a financial emergency than their peers, compared to 43% of those without a financial strategy; adults with a financial strategy feel twice as confident in their ability to meet their financial goals compared to those without a strategy; and 63% of adults with a financial strategy met or exceeded their savings goal for 2023, compared to only 37% of those without a financial strategy.
Action steps:
· Define clear short-term and long-term financial goals.
· Regularly review and adjust your financial strategy, especially in response to life changes.
· Seek guidance from financial professionals to enhance the effectiveness of your plan.
2. Tackle debt head-on to boost emergency preparedness
Addressing debt and fortifying emergency savings are crucial steps in achieving financial resilience. At the end of 2023, 28% of people said credit card debt had the largest impact on their finances that year. It’s no wonder, as among those with credit card debt, the average total debt owed was $7,931.80 — an increase compared to 2022. Creating a sustainable plan to pay down debt is critical, as it frees up money that can go toward emergency savings, increasing financial resilience.
Action steps:
· Create a debt repayment plan as part of your financial strategy, allocating more than the minimum payment each month when possible.
· Prioritize building emergency savings, aiming for at least three to six months' worth of living expenses available in a high-yield savings account.
· Consider financial literacy resources to enhance your understanding of effective debt management.
3. Tailor your approach to your unique challenges
While all generations and demographics share some commonalities, the reality is that disparities do exist between demographic groups. For example, Gen Xers and women reported lower levels of financial confidence than other groups: Only 57% of women are confident they will meet their financial goals, compared to 75% of men. Gen Xers reported the lowest level of confidence that they will meet their financial goals (55%), compared to Gen Zers (76%), Millennials (64%), and Baby Boomers (64%).
Tailoring your approach to address your specific challenges will ensure that you are supporting yourself in areas where you may have more difficulty than others, increasing the long-term sustainability of your strategy.
Action steps:
· Actively seek financial education resources tailored to you.
· Establish a support network or seek mentorship from a financial professional to navigate challenges.
· Enhance confidence and motivation by celebrating wins along the way.
Remember, your financial journey is unique, and by taking proactive steps, you can achieve greater resilience and success in 2024. Embrace opportunities for growth, and seek the support needed to make informed and empowered financial decisions.
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Media contact
Sara Sefcovic
New York Life Insurance Company
(212) 576-4499
Sara_M_Sefcovic@newyorklife.com