What defines the feeling of “making it” for the majority of Americans is not necessarily extravagant material possessions or high-flying job titles, but rather reaching financial independence, according to recent research conducted by Empower financial services.
A survey involving 2,000 US adults revealed that a significant 67% consider achieving financial independence as the foremost indicator of success.
Surprisingly, the income deemed necessary for this milestone is more modest than expected.
Empower’s findings disclose that less than a quarter of the surveyed individuals have attained financial independence.
This contrasts with traditional ideals where securing a satisfying job, establishing one’s own home, and settling down epitomized success, especially for those aged 25 to 34, in 1981.
However, contemporary challenges, such as soaring rental costs, heavy student debt, and a challenging job market, have made financial independence more elusive.
Over half of the respondents admitted to still relying on family and friends for financial support, particularly for rent (62%), internet and streaming services (56%), and phone bills (54%).
Despite previous assertions that a substantial $233,000 annual income would be required for comfortable living, Empower’s research suggests a more attainable figure.
According to the survey, the average American believes they would need around $94,000 annually to feel financially independent, although this still exceeds the median household income of $74,580.
The survey identifies various ways individuals perceive financial independence, ranging from living off passive income to achieving a work-free lifestyle.
However, for most respondents, it primarily means not relying on family and friends for financial assistance and establishing an independent life.
Contrary to parents’ hopeful expectations, the survey reveals that 92% of financially independent individuals only started feeling that way at the age of 36, not the earlier age of 23 as envisioned.
Empower’s financial expert, Keith Jones, emphasizes the importance of personal definition in the quest for financial independence.
“No matter your age, financial independence starts with clarity,” Jones advises. “Establishing clear financial goals provides both direction and purpose, motivating you to work towards a more secure and satisfying financial future.”
Survey reveals the top 10 financial indicators that Americans
Being financially independent/not relying on anyone else for money—44%
Moving up in my career/getting promoted—39%
Having a job I love—37%
Making a certain amount of money—25%
Not having to work at all—25%
Being able to spend money without worrying—22%
Being able to pay my bills on time—9%
Buying luxury items I want—7%
Being able to retire comfortably—7%
Buying a home—6%