Americans Prioritize Financial Health in 2025 Resolutions: Debt Reduction Tops List

Americans are gearing up for the new year with a strong focus on financial health, particularly debt reduction and money management. According to the latest research from CFP Board, nearly all surveyed individuals have identified at least one financial priority for 2025. Topping the list of financial goals for the upcoming year is reducing debt, with 42% of respondents aiming to tackle this challenge head-on.

The survey also revealed that many Americans are facing obstacles that could hinder their progress towards achieving their financial resolutions. Managing too many expenses and dealing with high levels of debt were cited as key barriers. Concerns about debt’s long-term impact on financial well-being and life plans were also prevalent among respondents.

To address these challenges, nine in 10 Americans are actively working on reducing their debt burden in 2025. Strategies include cutting back on discretionary expenses, increasing income, and exploring debt consolidation options. However, a significant number of individuals expressed uncertainty about how to start or lack access to financial guidance, highlighting the need for better financial education and support systems.

Financial advisors play a crucial role in providing guidance and clarity to consumers who are navigating their financial challenges. The survey found that 1 in 4 Americans work with a financial planner, such as a certified financial planner, for advice on managing debt and creating a holistic financial plan.

Debt’s negative effects on retirement savings were also highlighted in a separate survey by Allianz Life Insurance Company of North America. Many Americans reported that non-housing debt, such as car loans, credit cards, and student loans, was hindering their ability to save for retirement. Housing debt was also identified as a significant barrier to saving for retirement, particularly among Gen Xers.

Financial professionals can assist clients in developing a plan to reduce debt effectively and prioritize debt repayment based on interest rates and type of debt. By helping clients pay down debt, financial advisors can empower them to work towards their retirement goals and achieve long-term financial security.

Overall, the research underscores the importance of addressing debt and financial challenges proactively to secure a stable financial future. With the right guidance and support, Americans can take actionable steps towards achieving their financial goals in 2025 and beyond.
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