As the new year approaches, Americans are prioritizing financial health in their resolutions, with many focused on debt reduction and money management, according to CFP Board’s latest research, Debt and New Year’s Resolutions Report.
Nearly all Americans (97%) identify having at least one financial priority for 2025. Topping the list of 2025 financial goals is reducing debt (42%), followed by saving for a major purchase such as a car, house or vacation (21%) and retirement planning (14%).
Nearly 9 in 10 Americans report facing obstacles that could hinder their ability to achieve their 2025 resolutions — namely, having too many financial burdens and not enough resources to address them. Key barriers include managing too many expenses (38%) and facing high levels of debt (30%). More broadly, Americans are concerned about debt’s long-term effect on their financial well-being (52%) and life plans (48%).
“Debt is a major issue for most Americans that affects both immediate finances and the ability to plan for the future,” said CFP Board CEO Kevin R. Keller, CAE. “As we look ahead to 2025, a CFP® professional can help people create a clear, strategic plan to tackle debt and pursue all of their financial goals with confidence.”
Impact of Debt on Americans’ Financial Security
Half of Americans who hold some debt report difficulty managing at least one type of debt. Seven in 10 Americans with substantial medical debt express difficulty managing that debt, while 60% of Americans with high levels of credit card debt report similar struggles.
Credit card and housing debt in particular pose significant challenges for many Americans. High credit card balances make it difficult to reduce reliance on credit or pay more than minimum payments, which prolongs debt repayment. Housing debt also creates a burden, prompting some to explore refinancing to ease financial pressure.
Medical debt, while less common, has a profound impact on stability and personal well-being. It often leads to delays in necessary treatments and increased financial strain. Similarly, student loan borrowers also report difficulties, with many struggling to manage existing loans while hesitating to take on new debt for major purchases or education. To cope, many individuals seek deferment, forbearance or other strategies, while some miss payments or postpone further education altogether.
Americans Take Steps Toward Debt Reduction in 2025
Nine in 10 Americans are actively working to reduce their burden of debt in 2025, focusing on reducing spending, increasing income and managing debt more effectively.
To reduce spending, many are cutting discretionary expenses (like dining out and streaming services), sticking to budgets and choosing more affordable options such as store-brand products. On the income side, some are actively seeking opportunities to boost their earnings, recognizing the importance of increasing their financial resources. For debt reduction, many Americans are embracing structured strategies like increasing loan or credit card payments and exploring debt consolidation. However, a considerable number feel uncertain about how to start or lack access to financial guidance, underscoring the need for better financial education and support systems.
Financial Advisors Offer Valuable Support
For those uncertain about their finances, guidance from a financial professional can provide clarity. In fact, 1 in 4 Americans work with a financial planner, such as a CERTIFIED FINANCIAL PLANNER® professional, for advice on managing debt and creating a holistic financial plan.
“Our research reveals a strong desire among Americans to improve their financial well-being, but there’s a clear need for more resources and guidance, especially with navigating debt and budgeting effectively,” said Kevin Roth, Ph.D., Managing Director of Research at CFP Board. “One of the most significant findings is that Americans need to feel more equipped to take actionable steps. Working with a CFP® professional offers a starting point for many to begin this journey.”
METHODOLOGY
On October 14, 2024, CFP Board’s Research team sent an 18-question survey to randomly selected Americans aged 25 and 64 nationwide, as sourced by Alchemer. The panel ensures that the data collected reflects a reliable demographic and geographic representation of the U.S. population. The survey generated 806 responses, the data from which serves as the basis of this report and is subject to a sampling error of +/- 3.1% at the 95% confidence interval.
ABOUT CFP BOARD
CFP Board is the professional body for personal financial planners in the U.S. CFP Board consists of two affiliated organizations focused on advancing the financial planning profession for the public’s benefit. CFP Board of Standards sets and upholds standards for financial planning and administers the prestigious CERTIFIED FINANCIAL PLANNER® certification — widely recognized by the public, advisors and firms as the standard for financial planners — so that the public has access to the benefits of competent and ethical financial planning. CFP® certification is held by more than 100,000 people in the U.S. CFP Board Center for Financial Planning addresses diversity and workforce development challenges and conducts and publishes research that adds to the financial planning profession’s body of knowledge.
