What’s your biggest financial regret?
Is it not saving for and taking that trip of a lifetime when you had fewer commitments? Not getting up the courage to ask for that raise? Never investing in your great business idea? Not saving up enough money for college? Or, worse, spending your college money on that trip to Ibiza?
When it comes to financial regrets, Americans have plenty to go around – but they also have some pretty great financial triumphs.
How do we know? We surveyed over 2,000 people to ask about their early financial training, their biggest money successes, and their most heartbreaking financial regrets. Read on to find out what we learned.
America’s Money Training
Were you taught about money as a kid? Did you have a savings jar, and did you ever sit down with dad or mom to make a budget? When we asked our survey respondents if they were taught about financial matters when they were younger, the answers varied by state. It turns out, when it comes to understanding money early, location matters a lot.
The kids most likely to get a financial education? Those living in South Dakota, Vermont, and Wyoming. Utah and Alaska also ranked high, with 80 percent or more of participants reporting a financial education in childhood.
On the other end of the spectrum, fewer than 50 percent of respondents in Alabama, Mississippi, and Nebraska said they received a financial education as a young person – a fact that makes unfortunate sense when you consider that none of these states rank highly for education in general.
America’s Best and Worst Financial Decisions
The good news is that while some of our respondents got a late start learning about finances, they still have financial triumphs to report. Regarding their best financial decisions, survey takers overwhelmingly ranked getting a college education as No. 1. Other positive answers included buying a first house, living below their means in their 20s and well into their 40s, and not worrying so much about debt.
Unfortunately, it’s not all good on the financial front. When asked to rank their worst financial decisions, a large number of participants said they wish they had saved more of their monthly income, hadn’t lived quite so large in their 20s, and hadn’t racked up debt on unnecessary purchases. In fact, the average American between the ages of 18 and 65 has over $4,700 of credit card debt – an amount that, with an average credit card interest rate of 15 percent, can cost so much more by the time you pay it off with minimum payments.
Saving Habits and How Well They Work
Just under 10 percent of survey respondents ranked “not saving at all” as a top financial regret. But for those who save money each year, how do they do it? What tactics do they use and how helpful are they?
By far, the most frequently used saving tactic is the simple act of keeping a budget – something a majority of participants (just over 40 percent) say is extremely helpful.
Other helpful tactics include eating out less (for meals and coffee), staying out of debt (and thus avoiding that scary yearly interest), having money auto-deposit into savings, and living a minimalistic lifestyle.
Financial Advice From Your Older, Wiser Self
When asked what advice they’d give to a younger version of themselves, survey respondents recommended some of the same tactics they espoused themselves. Fewer than 30 percent recommended keeping a budget, nearly 28 percent said to stay out of debt, and just under 19 percent praised eating out less. Another 13 percent suggested having money auto-deposit into savings, and over 11 percent said a minimalistic lifestyle is the way to go when it comes to financial freedom.
Interestingly, these are some of the same words of wisdom successful people offered when Business Insider asked for their top financial tips.
Greatest Financial Accomplishments and Most Terrible Failures
As for the greatest financial accomplishments, most Americans said that paying off a large debt – be it on a home, car, or education – ranked at the top. Supporting a family, putting oneself through college, buying a first home, and signing a lease on a first apartment also ranked high on the list of things they were most proud of.
When it came to financial failures, however, not having enough money to buy a home was listed as the biggest regret for most of those surveyed. Never taking that trip of a lifetime almost ranked equally. According to San Francisco State University research, spending money on experiences really does make us happier.
Age and Accomplishment
If we break down financial regrets by age, we find that they change over time. For those aged 21 to 40, not having enough money to buy a house was the biggest regret, while those between the ages of 51 and 60 most regretted not being able to retire early. Finally, survey participants aged 41 to 50 and over 61 years old felt sorry for not taking that trip of a lifetime.
Education and Our Finances
Is money well spent when it comes to higher education? Based on our findings, it seems that way. Over 43 percent of participants answered they went to college and were glad they spent the money to do so. Surprisingly, 24 percent reported they went to college but felt it was a waste of money, while 19 percent said they went to college but wish they’d picked a cheaper option.
This line of thought aligns with education critics, like James Altucher, who point out that degrees don’t necessarily equal jobs, and that networking and other important skills can be gained by traveling instead.
When asked about paying for their kids’ college education, though, survey takers were overwhelmingly for education. Almost 65 percent said they paid for at least part of their kids’ education and were glad they did it, whereas some really wished they had.
The Trip of a Lifetime
We already know that not taking that trip of a lifetime is a top financial regret for many, but what about those who have used their money for travel – how do they feel about the finances they’ve devoted to the wide open road?
Perhaps unsurprisingly, the vast majority placed a high value on travel, with only about 16 percent saying they were glad they hadn’t spent money on travel or wished they’d spent less. Of those who report traveling “a lot,” fewer than 3 percent regretted the decision – perhaps further proof of the research that says experiences are the key to happiness.
Learning From the Data
According to the survey, the purchases most likely to leave you satisfied later are that trip of a lifetime and paying your kids’ way through college. Some accomplishments you’re likely to be proud of are buying that first house, signing that first lease, paying for your education, and living below your means while you’re young.
It's up to you to manage your personal finances and set goals. So what will you do with this information? Will you take that trip of a lifetime? Or is it time to get serious about that small business? Either option is good, but one is a great investment. If you're ready to fund your American Dream, head on over to Claris Finance to learn about our small business loans.
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