Hispanics are the most likely demographic group (26%) to say they feel “motivated” when thinking about financial planning in the current environment, according to a survey by Lincoln Financial Group.
The company’s monthly Consumer Sentiment Tracker also noted that the Hispanic population is well-intentioned when it comes to financial planning. For them:
• Saving for emergencies is the top financial goal (39%).
• Planning for the future is important (78%).
• The COVID-19 crisis has them thinking differently about their financial future (67%).
Thoughts To Action
However, there is a gap when it comes to transforming these aspirations into action. Nearly three quarters (73%) of Hispanic consumers prioritize day-to-day expenses over planning for their financial future, with at least half concerned about how to pay their mortgage or rent and their monthly bills, the survey noted.
Additionally, Hispanics have greater concerns than the total population about supporting themselves and their families if they were to lose their job (61% versus 50%) and paying off debt (58% versus 50%).
“Throughout the past year, we have championed research that enables us to gain valuable insight into the specific financial experiences and behaviors within our diverse communities, especially given the impacts of COVID-19,” said Elena French, senior vice president, head of Corporate Marketing, Communications and Brand. “Our latest study shows Hispanics are engaged in finances, but still face residual challenges from the pandemic. This underscores the need to develop a holistic financial plan, one that sets realistic goals and objectives to work toward from a budgeting and saving perspective.”
When asked what financial actions they would like to take in the next three months, about one-third of Hispanics expressed interest in adding to their emergency savings and creating a plan to pay down debt.
“While it’s encouraging that Hispanic consumers recognize the value of strengthening their financial security, this is just an important first step in a transformative journey,” said Linda Corujo Ramsey, president of Linda Corujo Retirement Center based in San Juan, Puerto Rico, and a registered representative of Lincoln Financial Securities. “We want to ensure that Hispanics — and all Americans — have access to, and are leveraging the tools, knowledge and education that will enable definitive progress when it comes to prioritizing retirement, protecting families against the unexpected, and creating the lifestyle they envision for the future.”
Creating Positive Outcomes
For that reason, Corujo Ramsey recommends several tips to help Hispanic consumers create positive financial outcomes:
1. Set a Monthly Savings Goal. Evaluate your monthly expenses against your monthly income and then commit to setting aside a monthly amount with which you feel comfortable.
Also, take advantage of financial-wellness solutions offered by your employer to help assess and address any financial issues you may be dealing with like credit card debt, student loans, and saving for retirement, and tap into online calculators and other tools.
2. Prioritize the Need to Create a Financial Plan. Feel empowered to take the initiative to review your financial situation and do it frequently, especially by having conversations with your loved ones. View a financial plan as a blank canvas where you are the artist who creates the final painting.. Above all, increase your emergency funds so you can have a financial cushion to fall back upon during challenging times.
3. Meet with a Financial Professional. Consider meeting with a financial professional who can provide personalized advice that meets your individual needs, and discuss your budget and financial goals with that individual to create a holistic financial plan.
Ayo Mseka has more than 30 years of experience reporting on the financial-services industry. She formerly served as Editor-In-Chief of NAIFA’s Advisor Today magazine. Contact her at [email protected]