How are you feeling these days about your savings?  Confident that you are on track to meet your goals, or downright worried because you’re having enough trouble meeting today’s obligations, let alone being able to think about tomorrow?  Or perhaps you’re somewhere in between:  concerned but at least trying hard to put something aside for the future.

CFP Board recently commissioned KRC Research to survey 1,000 working Americans over age 25 to create a map of consumer sentiments and habits with respect to saving.  The map was then divided into four approximately equal consumer profiles, each identified by their signature saving styles: Confident Savers, Concerned Strivers, Tentative Savers, and Stretched Worriers.  The first two categories consist primarily of men with higher incomes, whereas the Stretched Worriers are more apt to be low-income, single women with at least one child.  Tentative Savers are the most representative of the American population as a whole:  men and women in equal numbers, with average incomes and children still living at home.

While the study’s primary purpose is to show where American consumers stand with respect to their savings, debt, and confidence about the future, it also suggests how they might change their financial location – how for example to move from “concerned” to “confident,” or from “stretched” to “striving.”  In other words, there are financial lessons that can be learned from each demographic segment.

Confident Savers teach us the importance of early savings, starting with a first full-time first job.
This segment, the majority of whom are well educated, start saving on average at age 28, earlier than other segments.  The financial confidence of these individuals as well as their success later in life is not just a result of positive thinking or luck, but of action taken early to save for their future.

he profile of this group also reminds us that a college degree is important too, as the way to set up a virtuous financial saving cycle.  A college degree leads to higher pay, which leads to more ability to save and accumulate investable assets.

Concerned Strivers show us the importance of having a spending plan.
Knowing what you are routinely spending and being prepared for the big expenses when they come can eliminate needless expense, overspending, and borrowing costs.  It can also eliminate or ease the chronic concern that many consumers harbor.

This segment has relatively high income, compared to Tentative Savers and Stretched Worriers, but has to juggle to make ends meet.   As a result they frequently feel unable to save.  What’s important for this group is making sure saving comes first in the spending plan, even if in limited amounts, and finding more room in the budget to support this savings. By keeping focus on the big life goals, the money needed for these goals can be easier to find in the less important categories of spending.

Tentative Savers remind us that while saving regularly is important, saving enough is also necessary to build financial confidence.
These consumers are not without financial resources:  they have adequate incomes, and are generally taking advantage of employer provided retirement accounts. But their sense of losing ground as they approach retirement suggests they have not been aggressive enough in terms of the amounts they are setting aside.  Ask yourself if you are in this category:  “Am I saving up to an employer’s match?  Can I save something each month outside of my retirement plans?   Is there a bit more room in my budget for more saving and less spending on discretionary items?  Do I need to think about working longer?  Do I need to think about upgrading my workplace skills in order to be eligible for a higher paying job?”  For this group, it’s imperative that they trade “tentative” for “determined” and avoid a sense of hopelessness about their financial futures. 

Stretched Worriers show the importance of “first things first” in building financial resources.
As the most financially fragile of the four demographic segments, Stretched Worriers feel unable to save, and have trouble staying current on their monthly bills.  If this is your case, simply changing your mindset about the importance of regular savings is not the answer: you must first take measures to improve your value in the workplace.  In other words, you must invest in your human capital, in order to begin to accumulate financial capital.  Focus on job training, education, community networks and resources to improve your marketability to employers.  Once employed in a better, higher paying job, then start applying the lessons of Confident Savers and Concerned Strivers by getting on the virtuous cycle of contributing to employer plans, or setting up your own individual retirement accounts.  Build a strong credit score and avoid credit card debt.

One final finding from the survey that is consistent across all demographic segments is the belief that financial planners are the most reliable sources of financial information – more so than newspapers, websites, or other professionals.  The takeaway lesson from this finding?  Put this widespread belief into action and find a CFP® professional today at Let him or her help you work your financial map to take you from a place of worry or tentativeness to a position of confidence about the future.