When headlines scream about union strikes or government shutdowns, it's easy to fixate on the immediacy of missed paychecks and the struggle to pay bills. But what if the real story here isn't just about these immediate crises? What if it's indicative of a deeper, systemic issue — a fundamental lack of financial health and wellness in America?
The problem runs deeper than strikes and shutdowns
To many, a government shutdown or a strike might seem like an isolated problem, but they're merely the tip of the iceberg. According to a Federal Reserve study, 40% of Americans would struggle to come up with $400 for an emergency. Not only that, but 40% of people making $100,000 or more are living paycheck to paycheck, according to LendingClub.
Shutdowns and strikes are not the issue; they merely expose the house of cards that is financial health in America. Even if shutdowns and strikes didn’t happen, far too many people face a daily reality that is about surviving and not thriving. What happens if the car breaks down? The house needs a repair? Or, heaven forbid, the kids need new school clothes or athletic gear for the upcoming season?
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
A house without a foundation: A lack of financial literacy
For most Americans, financial literacy is a hit-or-miss affair. Schools teach algebra and history, but how many of us have sat through a class on personal finance? In high school, I could recite a passage out of Shakespeare but couldn’t tell you a darn thing about income, taxes, student loans or saving for the future.
A study from the National Endowment for Financial Education found that only 24% of Millennials demonstrate basic financial literacy. What's worse, only a few states have a personal finance requirement in high schools. What about colleges and universities? They’ll teach you all about equity analysis (i.e., how to pick individual stocks — we can debate this topic later) but nothing about sound personal finances.
This lack of financial education cripples us right from the start and leaves us unprepared for life's many unpredictable turns. What’s worse is that poor financial literacy gets handed down from generation to generation.
Unbiased and personalized financial advice: A rarity, not a given
Even for those with the initiative to seek out financial advice, a significant barrier remains: access to unbiased, personalized and affordable guidance. Financial advice has been, for decades, an exclusive club for wealthier Americans. If you had a lot of money, made a lot of money or were willing to pay a lot of money, someone would take your call and offer you advice.
Yet, if you dig deeper, you would find that there were no standards for the quality of the financial advice you would receive or the quality of the financial adviser — education, experience and ethical standards were optional. And what about this whole “fiduciary” thing? When the broader industry caught wind that brokers, insurance and annuity salespeople and the like would have to act in your best interest (i.e., do the best thing for you as the client), they fought tooth and nail and spent hundreds of millions of dollars to lobby against it.
What we have today is a confusing web of rules and regulations that create different service standards for different types of financial “professionals” who can all call themselves whatever they want — adviser, planner, wealth manager, you name it. The bottom line is that the majority of people are navigating the complex world of personal finance, the economy, life and a rapidly changing technology landscape without access to quality, unbiased and affordable advice and guidance.
It's time for a paradigm shift
The question we ought to ask ourselves is, "If we didn’t have shutdowns and strikes, would we be better off?" The answer, dishearteningly, is likely no. Without addressing the systemic issue of financial illiteracy and lack of access to quality advice, most workers would still be living paycheck to paycheck, without an emergency fund and with no clear plan to get out of debt or save for the future.
We need a transformative approach to financial wellness in America, one that democratizes access to education, tools and unbiased financial advice. Imagine a world where you don't have to be wealthy to get advice tailored to your life circumstances, where schools equip young people with the skills they need to manage money effectively and where emergency funds are the norm rather than the exception.
This isn't just about preparing for the next shutdown or strike; it's about fundamentally improving the financial circumstances of every American. It's about laying the foundation for a life not just of financial security, but of financial freedom.
You see, financial wellness isn't just about getting by; it's about thriving. It's about building a life where money isn't a source of stress but a tool for opportunity. This isn't an unattainable ideal; it's an achievable reality — but only if we prioritize access to the education, tools and unbiased, affordable financial advice that everyone deserves.
Let's not settle for merely surviving the next crisis. Let's aim higher. Let's equip people with the skills and resources they need to not just weather life's storms, but to sail through them toward a brighter, more secure future.
Related Content
-
Financial Planning: Sisters Should Be Doin' It for ThemselvesMore and more women are ringin' on their own financial bells (with apologies to Aretha Franklin and Eurythmics) — but that demands a robust financial plan.
-
Stock Market Today: Stocks Dragged Down by Strong DataInvestors weigh the prospect of no more rate cuts in the current cycle.
-
Financial Planning: Sisters Should Be Doin' It for Themselves
More and more women are ringin' on their own financial bells (with apologies to Aretha Franklin and Eurythmics) — but that demands a robust financial plan.
-
Is Money Messing Up Your Family's Life?Parents who discuss money and attitudes toward money with their children are more likely to raise financially successful and responsible adults.
-
Do You Know the Power of Whole Life Insurance in Retirement?Worried about legacy planning, market volatility or where to get cash to cover surprise medical or home repair bills? This little-known tool could help.
-
10 Ways Retirees Can Manage Income DistributionThe goal of a retirement income plan is to make the most of your money while ensuring that it lasts. These 10 strategies can help secure your financial future.
-
Gifting Earlier Rather Than Later Can Reap Big Tax BenefitsEven with Donald Trump's win, the future of the Tax Cuts and Jobs Act remains uncertain, so here's how to make the most of its provisions while you still can.
-
A Frugal Saver's Guide to Spotting Investment CostsSome of the fees that come with buying or holding stocks, bonds and other investments are obvious. Others can hide in plain sight.
-
Are Democrats or Republicans Better for My Insurance Premiums?Let's compare how these two political parties might affect your insurance premiums now that the 2024 election is over.
-
Four Financial Steps That Can Help the Sandwich Generation CopePeople who are caring for kids and aging parents at the same time can take a hit mentally and financially, so make sure you're tapping into all available help.
