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America's Financial Regrets And Resolutions For 2025
60% of adults would buy more financial products if only they knew more about them
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Happy Sunday, and welcome to Benzinga’s financial advisor newsletter.
Today we’re discussing the regrets and resolutions about their finances that Americans are taking with them into 2025, and what that means for advisors and their businesses in the New Year.
So, let’s get into the Industry Chatter!
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INDUSTRY CHATTER
Recent surveys from Nationwide and Fidelity Investments reveal the financial regrets and resolutions that Americans are taking with them into 2025, InvestmentNews recently reported. The data points to significant gaps in financial planning that advisors should reshape how financial advisors approach client relationships in 2025.
82% Of Over-45s Regret Not Planning For Retirement Sooner
The most pressing concern emerges from Nationwide's Protected Retirement Survey, where an overwhelming 82% of Americans over 45 regret that they hadn't planned for retirement seriously earlier in their life. This statistic should serve as a wake-up call for advisors to engage clients earlier and more comprehensively, and to help existing clients look into ways to "catch up." Rather than waiting for clients to seek guidance, advisors need to take the initiative in reaching out to younger professionals, helping them understand compound interest, and developing robust income protection strategies before retirement concerns become urgent.
Saving For A Rainy Day Is A Key Priority For 2025
The Fidelity Annual Resolutions Study highlights another crucial area demanding advisor attention: emergency preparedness. With 72% of Americans reporting financial setbacks in 2024 and 46% needing to tap into emergency funds, advisors must shift from focusing solely on long-term goals to helping clients build resilient financial foundations. This means developing comprehensive emergency funding strategies alongside traditional retirement planning.
Advisors should note the changing client mindset toward conservative financial goals, with one-third of resolution-makers preferring more modest targets for 2025. This trend, coupled with 38% of respondents citing unexpected expenses as their primary concern, suggests advisors need to adjust their approach. Instead of pursuing aggressive growth strategies, many clients may benefit more from balanced plans that emphasize stability and risk management.
Despite Troubles, Most Americans Are Optimistic About 2025
The silver lining is that 68% of Americans feel financially stable or stronger than last year, with 65% expressing optimism about 2025. Advisors can build on this positive sentiment by helping clients transform their financial regrets into actionable plans. This means moving beyond traditional portfolio management to provide comprehensive financial guidance that addresses both immediate concerns and long-term goals, while ensuring clients have adequate protection against unexpected setbacks.
MARKET RECAP
The tech-heavy Nasdaq 100 index – as tracked by the Invesco QQQ Trust (QQQ) – extended its relentless climb this week, setting new record highs and nearing the 22,000-point milestone, fueled by strong investor optimism in the Magnificent Seven tech giants and the transformative potential of artificial intelligence.
Year-to-date, the index has posted a robust 30% gain, on track to outperform the S&P 500 for the ninth time in the last decade.
Since the start of 2023, the Nasdaq 100 is on track to double, nearing a 100% gain – a performance last achieved in 2019-2020 with a 102% rise and previously hit during the dot-com boom of 1998-1999.
Notably, five out of the seven Magnificent Seven stocks— Apple Inc. (AAPL), Amazon.com Inc. (AMZN), Alphabet Inc. (GOOGL), Meta Platforms Inc. (META), and Tesla Inc. (TSLA) — achieved fresh record highs this week. The combined market capitalization of the group exceeded $18 trillion, surpassing China's gross domestic product at the end of 2023.
Broadcom Inc. (AVGO) emerged as the week's standout performer, soaring after a strong quarterly earnings beat and delivering upbeat AI-driven guidance for the coming year. The rally propelled the chipmaker into the exclusive $1 trillion market-cap club, making it the eighth-largest publicly traded company.
Inflation data released during the week raised some red flags. Consumer inflation rose 2.7% year-over-year in November, in line with expectations, but producer inflation jumped to 3% year-over-year, exceeding estimates of 2.6%. This marked the sharpest increase since February 2023, raising concerns about potential cost pass-throughs to consumers.
Investors are fully pricing in a 25-basis-point interest rate cut at the Federal Reserve’s Dec. 18 meeting. Yet policymakers may signal fewer rate cuts for 2025 — potentially just three — while leaving open the possibility of a pause as early as January.
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THE WEEK AHEAD
Economic Data
Monday: Germany, EU, US preliminary purchasing manager index numbers
Tuesday: US retail sales numbers
Wednesday: US and Japan interest rate decisions
Thursday: US existing home sales and preliminary quarterly GDP
Friday: US core inflation
Earnings
Click here for the full calendar of economic data and earnings reports.
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