Americans who identify as part of communities are more financially secure, according to a new survey from MassMutual
It takes a village to get rich.
Roughly half of Americans (48%) who identify as part of a community — in many cases a neighborhood, social or religious group — say that’s helped improve their finances. What’s more, almost seven in 10 (69%) say that being part of such communities helps to reduce anxiety around their finances, according to a new survey conducted by MassMutual Life Insurance.
Why? One reason is that — through networking, connections and mentoring — people involved in communities tend to land better jobs and can make more informed decisions about money, because they had people to consult, according to MassMutual spokesperson Paula Tremblay. That effect was particularly profound for certain groups: “We did an oversampling in the LGBTQ space, and what came across very loud and clear that career connections and mentoring came out of their involvement in their community, for instance,” Tremblay said. Similar effects were observed among other constituencies like the African American and Hispanic communities.
And that’s not all: People involved in communities exhibit a sense of “maturity,” Tremblay added, which means that, through their interconnectedness, they’re more apt to invest in their savings, plan for retirement or emergency needs, and make less rash and selfish money-related decisions.
Other experts say this finding makes a lot of sense.”The biggest explanation for why communities influence your money choices so much is because your money choices are just so heavily influenced by the people that you’re around,” said personal finance expert Kim Palmer of NerdWallet. “When you have the support of other people you can talk to, even everyday things, choosing to spend less and save more money can have a big long term [impact] on your finances.”
And previous research has verified MassMutual’s conclusions. Take, for instance, a 2015 Gallup survey which linked financial well-being with the perceived state of people’s relationships with their spouses, partners, or close friends. The survey found that, among Americans, 87% of those who viewed their relationships with such important people in their lives as strong considered their finances to be “thriving.”
While that’s slightly different than the connotation of being part of “community,” per se, it speaks to a visible link between people’s financial status, and the way they see their interpersonal bonds with others. The healthier one is, the healthier the other seems to be, too.
Another major conclusion from MassMutual’s survey was that millennials seem to be more open about discussing, and even sharing, their finances with one another.
Six in ten have “supported someone in their community in a time of financial stress,” according to the report, versus 55% of Gen-Xers and 50% of baby boomers. On the flip side, 38% of millennials also confess that they’ve been supported by their fellow community members when their cash is running low, as opposed to 25% of Gen-Xers and 17% of boomers.
Palmer warned that this can have an adverse affect, though — if your Instagram clique is obsessed with outdoing one other, be prepared to kiss your whole paycheck goodbye in an effort to keep up.
To gather their results, MassMutual consulted 10,000 US adults ages 18+ in September 2017, across a variety of ages, genders, races and ethnicities, and education levels. Communities could be anything from a book club to a Weight Watchers group to a church congregation.
© 2018 Dow Jones & Company, Inc. All Rights Reserved