The numbers don’t surprise me.
However, they should make you sit up if you think you can put your dream retirement and the inheritance of your heirs in the hands of the U.S. financial system.
Let’s start with the first observation by the LendingClub (which many are blind to).
As of September, 62% of U.S. adults said they live paycheck to paycheck.
In other words, regardless of what you see in the mainstream media…
Most Americans still struggle with their finances as stubbornly high prices for food, gas, and shelter make it increasingly challenging to save in this economy.
Will it get better soon?
The consensus among central bankers is that interest rates could stay higher for longer.
This creates another problem because “higher-for-longer” rates increase the cost of borrowing and make it challenging for folks to manage debt. No wonder a new CNBC survey found that 74% of Americans report feeling stressed about their finances.
It’s not just inflation and rising interest rates contributing to this financial misery. There’s also a lack of robust savings, making it impossible to have financial peace of mind.
Many households have been forced to tap into their savings. Some have seen a decline in their savings, with nearly half (49%) having almost zero savings compared to 2022.
This means most people don’t have a financial buffer for emergencies. And it reminds me of the systemic financial torture my friend Steven Place has warned about for years.
You could read all this and say: “But Anthony, despite the financial challenges, high-income households are benefiting from better interest payments on their savings.”
Of course, high-yield savings accounts, certificates of deposit, and money market accounts offer over 5% interest rates, and the more money you have in your savings account, the bigger your interest payments. However, the keyword is “high income.”
How many households have a high income? More importantly, even if you’re among the few in that category, what is the likelihood that you can build your dream retirement (and a robust inheritance for your kids and grandkids) from a 5% interest payment?
Can you see why most people will never have their dream retirement? And why almost everyone you know is desperately trying to “leapfrog” their wealth forward overnight?
There’s nothing wrong with trying.
But the harsh reality is that if you don’t understand the current market cycle and which investments can realistically multiply your wealth without taking unnecessary risks…
You’ll likely end up like desperate investors who chase everything only to lose it all.
That doesn’t have to be your story.
If you need proper guidance to improve your financial situation and start building a dream retirement today, check out our BEP approach for creating lasting wealth.