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Saturday, July 13, 2024

Most Americans will pay a high price for peace of mind

Financial peace of mind 2

New Empower research shows more than half of Americans are willing to pay a high price for financial peace of mind (56%): In fact, 1 in 5 say they’d be willing to take on debt for items or services that help them achieve it (19%). 

The majority define it as being debt-free (81%) and paying bills on time and in full (79%). For over 3 in 5 Americans, it’s affording everyday luxuries without guilt. 

Key takeaways 

  • Americans say financial peace of mind comes from the ability to retire when they want (63%) and being able to afford experiences with loved ones (57%).  
  • Many also defined it as having a work-life balance (55%) and owning a home (53%). 
  • Nearly 7 in 10 Americans (68%) are willing to pay more for items or services that help them achieve financial security. 
  • 66% of Americans are willing to spend more for an item or service if it buys them more free time.
  • 6 in 10 say they would increase their retirement savings contribution (62%) and up their investments (45%) if they got a raise. 

What is financial peace of mind? 

Infographic showing survey results.

For over half of Americans, financial peace of mind comes from the ability to retire when they want (63%) and being able to afford experiences with loved ones (57%). Many also define it as having a work-life balance (55%) and owning a home (53%). 

Most Americans (68%) would pay more for items or services to help them achieve their financial goals. Two-thirds (66%) are willing to spend more if the item or service gives them more free time. Almost 1 in 5 Americans say items or services that provide financial peace of mind are worth taking on debt (19%). 

Almost three-quarters of Gen Z (73%) are willing to pay more for items or services that could help them achieve financial independence and security — the most of any generation. Millennials (71%) and Gen Z (68%) are also the most willing to spend more on items or services that create more free time. 

To save or splurge? 

Infographic showing survey results

Americans are willing to pay a higher price for services and experiences over “things.” When it comes to putting a dollar amount on financial peace of mind, Americans spend an average of $3,276 on each service or experience that brings peace of mind compared to $2,449 on an item.  

Americans consider vacations (56%), dining out (45%) and buying concert tickets (38%) luxury experiences. More than a third say service subscriptions like TV streaming options are a luxury (36%). On average, Americans spend $1,893 on each splurge. Over a third (36%) would pay more for exclusive experiences or items. 

Infographic showing survey results

On average, Americans say they spend $726 on each luxury product they buy, with some (21%) spending over $2,000 per item. Looking at specific purchases, Americans are more likely to label electronics like smartphones, big-screen TVs, and video game systems as luxury purchases. For almost a third of Americans, two of the largest peace-of-mind purchases include home ownership (30%) and purchasing a car (30%). 

In the event of a salary increase, 62% of Americans would increase their retirement savings contribution and investments (45%). Some 42% would put the money towards experiences like traveling or dining out. 

Spending and satisfaction 

Infographic showing survey results

Methodology 

Empower commissioned an online survey of 1,011 Americans from April 10-16, 2024. 

About Empower 

Empower, a leader in financial planning, investing, and advice, is dedicated to creating financial freedom through people and technology. Connect with us on Empower.com and subscribe to The Currency™ for the latest money news and views shaping how we live, work and play. 

Fair use statement 

You can use this content for noncommercial purposes by including a citation link. 

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The Currency editors

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The CurrencyTM, a publication from Empower, covers the latest financial news and views shaping how we live, work, and play. We keep you current on ways to plan, save, and invest for life.

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