Make Ends Meet: Money management

The ability to invest, save, budget and spend prudently is not something that is not often informally or formally taught.
Published: Sep. 4, 2023 at 11:14 PM EDT
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LOUISVILLE, Ky. (WAVE) - The topic of money management can cause anxiety for many.

The ability to invest, save, budget and spend prudently is not something that is not often informally or formally taught. A Clever Real Estate survey of 1,000 Americans found most people struggle with “something” when it comes to handling their finances.

Sam Huisache, a Data Writer at Clever Real Estate, explained most Americans support making financial education more of a priority for young adults.

”Nearly half of Americans consider money management the most important life skill that you can have over things like communication skills, critical thinking and problem-solving skills,” Huisache said. “But on the same token, one in seven Americans say they’re not confident in basic math. So that translates into their inability to actually do a lot of personal finance on their own.”

16% of Americans polled say they cannot write a check without assistance. Younger generations may be more apt to pay by electronic bill payment. 21% of Americans are not confident with managing their money when it comes to saving for the future.

“We found over one in five Americans don’t know what a 401(k) is,” Huisache said.

When asked on the Clever Real Estate Survey, 21% of respondents answered they did not know that a 401(k) was a retirement savings plan offered by employers to their workers. About 13% answered incorrectly from a range of choices. Another glaring money mistake found in the survey was the lack of preparation when someone leaves the workforce.

“We found that nearly 17% of Americans say it’s best to wait until your 40s to start saving for retirement,” Huisache said. “The older generations you know who are living long enough to know better than that are like no way. That’s not true.”

The short answer to when you should start saving for retirement is now! You should begin saving for retirement as soon as you get a job.

When it comes to generational wealth and a piece of the American dream, information is still lacking.

”We asked what is a down payment in real estate,” Huisache said. “And we gave them a few choices from which to choose, and they had to pick one.”

Only 65% of Americans were able to answer correctly when it came to placing a down payment on a home with boomers coming in at 85%, 67% of Gen X, 57% of millennials, and 44% of Gen Z choosing the right answer.

“The correct answer is the sum the buyer pays upfront for the home,” Huisache said.

When it came to the rising prices families are facing in the U.S. and the issue of inflation, those pollsters were still unsure how the Federal Reserve handles inflation.

“Inflation impacts all of our lives no matter whether or not you want to be in the know about financial finance and stuff like that,” Huisache said. “So we asked them which of the following tactics is used to lower inflation. There was a percentage of people that said just printing money. 21% said lowering interest rates. Only 35% of people chose raising interest rates.”

One simple budgeting rule that may be easy to follow is the 50/30/20 method. 50% of your pay goes toward your essentials in life like gas, food, and rent. 30% can be used for clothes, eating out and even for charity. 20% goes to your retirement, emergencies or paying down debt.

For a look at the numerous topics used in the survey, click or tap here.