A Publication of WTVP

From record-breaking stock market returns to falling unemployment, the U.S. has no shortage of positive economic indicators. In addition, the majority of investors say they feel confident about achieving both their short- and long-term goals, according to the latest Morgan Stanley Investor Pulse Poll, which surveyed more than 1,200 investors ages 25 to 75 with over $100,000 in assets. About one in four (29%)—or 36 million—U.S. households fall into this category.

Mostly Sunny, With Some Clouds
Investors are upbeat overall, with about nine in 10 either “somewhat” or “very” happy with their financial situation today. Also, nearly nine in 10 expect their portfolios to stay strong or improve in the coming year. Most (91%) believe they're solidly on track to realize long-term goals like:
– Saving for retirement;
– Paying off a mortgage;
  – Transferring their wealth to the next generation; or
  – Paying for a child's or grandchild's education.

Nearly all (93%) are confident they'll achieve short-term goals like paying for travel, home and car expenditures. Still, the investors polled aren't entirely carefree. More than two-thirds (67%) fear running out of money in their lifetime, and 56 percent are uneasy about being able to maintain their standard of living.

Having enough money to manage retirement and unexpected medical costs are key concerns shared by more than half (56% and 52%, respectively) of investors, and two-thirds (69%) are concerned about how the political climate will affect their finances.

Even Millennials polled say they are worried about retirement, with 72 percent of them concerned about having adequate funds, while 69 percent are uneasy about making that money last a lifetime. Of investors ages 45 and above, about nine in 10 say they wished they had started saving for their goals earlier—with nearly half highlighting retirement in particular.

What can explain this apparent paradox between investor optimism and concern? In a nutshell: a lack of planning. Many investors admit they need help with finances, but fail to seek it.

Planning with a Financial Advisor 
Roughly half of all investors working with a professional are looking for help with a written plan that includes budgeting, expenditures and investments. Still, only one in three investors has a professionally prepared financial plan. Many apply a do-it-yourself approach (27%) or have no plan at all (36%).

Of the 36 percent of investors who do opt for a professionally prepared, goal-driven plan, 80 percent credit their financial advisors with their financial success.

Happier Investors Practice Good Financial Habits
Investors surveyed who reported being happiest overall also say they are less troubled by financial worries than their peers. They're less concerned about issues like having enough money for retirement or unexpected medical expenses. What's their secret? They practice healthy financial habits like having a financial plan in place, meeting short-term and long-term goals, and discussing finances with their significant other.

Working with a trusted professional familiar with your financial situation to develop a personalized plan driven by your goals can help build financial confidence in good times and bad. When those plans are combined with good financial habits, investors can move toward goals including buying a home, retirement, travel or paying for education. Talk with your financial advisor (or find one) to build your plans today. iBi

Cathy S. Butler, CFP, CRPC, is a vice president, financial advisor and portfolio management director at Morgan Stanley Wealth Management. She can be reached by email at [email protected] or by telephone at (309) 671-2873.

This material does not provide individually tailored investment advice. It has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. The strategies and/or investments discussed in this material may not be suitable for all investors. Morgan Stanley Wealth Management recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a Financial Advisor. The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives.