Americans Rank Government Dysfunction and Elections as Top Causes for Financial Concern in 2024
Written by
Gabrielle Olya
Edited by
Molly Sullivan
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Americans are feeling more financially insecure than ever before. According to a recent Northwestern Mutual study, “One-third (33%) of adults say they do not feel financially secure. This represents a jump from 27% who said the same last year and is the highest level of insecurity recorded in the study’s history.”
While Americans cite inflation as their top financial concern in 2024 (57%), “government dysfunction” (34%) and “the U.S. presidential election” (33%) were not far behind. Americans view these events as bigger concerns than a potential recession (24%), interest rates (24%), market volatility (15%) and geopolitical conflicts (14%).
Here’s a look at how government dysfunction and the upcoming presidential election could affect your personal finances, and how to remain financially secure no matter what happens in the political arena.
How Government Dysfunction Could Affect Your Finances
The overall economy might not affect you on a day-to-day basis, but government dysfunction could have a direct impact, said Kurt Rupprecht, partner and private wealth advisor at K Street Financial, a Northwestern Mutual Private Client Group.
“Generally speaking, the U.S. economy is too big and complex to significantly sway from its natural trend rate of growth. But functions of a government can have an impact on Americans and their finances in 2024,” he said. “This can come in the form of budgetary delays, uncertainty in policies, and potential disruptions in different sectors like healthcare, infrastructure and social services. Such dysfunction can also impact consumer and investor confidence, leading to market volatility and economic uncertainty.”
How the Presidential Election Could Affect Your Finances
Rupprecht does not believe the presidential election will greatly impact an individual’s personal financial security.
“Presidents can nudge the economy in one direction or the other, but the overall impact is often limited,” he said. “There could be changes in tax regulations, trade agreements and government spending priorities. These changes can impact personal finances, investment strategies and overall economic conditions. The business cycle, however, has a larger impact on the economic and market outcomes during a president’s time in office, regardless of party.”
Should You Be Concerned About Government Actions and Election Outcomes When It Comes To Your Finances?
It’s clear that the state of the U.S. government is top of mind when it comes to how Americans think about their finances in 2024. But should it be a primary concern?
“Concerns about government dysfunction may be valid, but Americans should also pay attention to those other economic factors like recessions, interest rates and market volatility,” Rupprecht said. “These are the factors that have more of a direct effect on employment opportunities, investment returns and financial stability. It’s crucial to consider all these aspects when making financial decisions.”
How To Keep Your Finances Secure — No Matter What
We can’t predict how well (or how poorly) the government will function or who will win the election, but there are things Americans can do to ensure they are financially secure no matter what happens this year.
“By staying proactive and informed, Americans can navigate through uncertain times and maintain financial security in the face of government dysfunction and political changes,” Rupprecht said.
To protect your finances amidst concerns about government dysfunction and the presidential election, he recommends the following steps:
- Diversify investments to reduce risk exposure.
- Maintain savings or an emergency fund to cover sudden expenses.
- Avoid making impulsive decisions based on short-term uncertainties.
- Stay informed about economic and political developments that could impact finances.
- Create a plan and seek advice from a trusted professional to adjust financial strategies based on an ever-evolving landscape.
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