New Year’s resolutions have a mixed reputation: Some see them as a nice nudge to start off the year on the right foot, while others view them as pie-in-the-sky life overhauls they’ll never actually uphold past January. Both things can be true, which is why it’s important to temper your resolutions with a dose of reality.
For instance, maybe it’s unrealistic to say you can stop shopping for a full year, but perhaps you could pledge to stick to your budget for discretionary spending or even just shop more mindfully. Because the truth is, even these small moves can add up to a noticeable impact on your financial life.
1. Create a plan for spending and saving
A budget is the bread and butter of smart financial management. But for some, the standard monthly budget can seem intimidating. Another option you might try is a weekly budget, as “with a weekly vs. monthly budget, the amounts you have to track are smaller and more manageable, and you may be more likely to stick to them,” SoFi explains. Another tactic is a spending plan, which “allows you to choose what you spend your money on instead of restricting yourself on what you can’t spend,” suggests Bankrate.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
SUBSCRIBE & SAVE
Advertisement
Sign up for The Week’s Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
In other words, do aim to budget in the new year — just find a way to do so that actually works for you.
2. Save more than you are right now
If saving the suggested 20% of your income every month sounds like a steep ask, try this instead: Simply aim to save more than you are right now. If you’re not currently saving anything each month, then you can just plan to start setting aside a little bit each month to get an emergency fund established. Or, for instance, if you’re already diverting a certain percentage of your paycheck to your retirement account each month, see if you can put aside just 1% to 2% more each month this year.
It’s also important to consider where you’re saving. As CBS News points out, “traditional savings accounts may provide a sense of security, but they often fall short when it comes to earning substantial interest.” Instead, you might consider a high-yield savings account or even diversifying your savings by allocating a portion to a certificate of deposit (CD).
Advertisement
3. Improve your credit score
As Bankrate highlights, “your credit score plays a critical role in determining whether you get access to financing and other financial services you need,” which is why improving it is a worthy 2024 goal. According to CNBC Select, you can “improve your credit score in several ways, including paying your bills on time and in full (setting up autopay can help), paying off debt, limiting how many new accounts you open, and cutting back on spending.”
It’s also helpful to check your credit report to scan for any errors or signs of fraud, which you should be doing on a regular basis anyway.
4. Pay down credit card debt
Thanks to high interest rates, credit card debt can compound quickly, which is why it’s important to jump on tackling it if you have any. Per Investopedia, a good first step is to determine how much you can realistically afford to pay off during the year,” while at the same time, attempting “not to charge additional purchases on those cards.”
There are a few different strategies you might consider to make paying down your debt feel more manageable. According to Bankrate, “two common strategies are paying off your highest debt first (the debt avalanche method) and paying off your smallest amount of debt first (the debt snowball method).” And “if you’re struggling with making payments, consider credit counseling, a low-interest balance transfer, a personal loan or even debt settlement,” Bankrate suggests.
Most investors still feel like the market is fragile. Morgan Stanley thinks it is further along than they realize.
In his Sunday Start note dated April 12, Morgan Stanley equity strategist Michael Wilson argued that the S&P 500 was in the process of carving out a low after hitting the bottom of the firm’s targeted correction range of 6,300 to 6,500. The bank has consistently maintained that this is a correction within a new bull market, not the start of a bear market.
“As always, the market trades in advance of the headlines. Investors should do the same,” Wilson wrote.
The correction began last October, Wilson noted. Since then, the S&P 500’s forward price-to-earnings ratio has declined 18% from its peak.
That kind of P/E compression typically accompanies a recession or an actively tightening Federal Reserve. Morgan Stanley’s base case includes neither.
Advertisement
More Wall Street
Beneath the surface, more than half of the stocks in the Russell 3000 have dropped 20% or more from their 52-week highs. Wilson does not see that as a sign of complacency. He sees it as a market that has appropriately discounted the risks.
The key supporting argument is earnings. Price damage for the S&P 500 has been contained to less than 10% because earnings growth is moving in the opposite direction from valuations. Falling multiples alongside improving earnings growth is, in Wilson’s framing, the signature of a bull market correction rather than a bear market.
Wilson addressed the comparisons being drawn to previous oil shocks directly. In those prior cycles, he noted, earnings were already deteriorating or falling sharply when energy prices spiked.
Today, earnings are accelerating from already high levels. The median company is growing earnings per share in the double digits, the fastest pace since 2021.
Advertisement
Tax refunds are running more than 10% higher this year, which Wilson cited as additional context for why the oil move feels more contained in practice than in headlines.
On other risks, Wilson argued that both private credit and AI disruption appear better understood by markets, with many affected stocks already down 40% or more.
On private credit specifically, he cited colleague Vishy Tirupattur’s view that risks are material but not systemic, and that tightening in private credit could ultimately drive business back toward traditional lenders.
Advertisement
With AI, Wilson said the disruption narrative has moved faster than actual implementation and that the enterprise application layer remains in early days. In the near term, he said AI looks more likely to support margins than compress them, particularly for early adopters.
Mordant/Getty Images
Wilson was clear about what stands between the market and its next leg higher. The equity-rates correlation has turned decisively negative again, meaning higher yields are once more a direct headwind for valuations.
The recent hawkish pivot from central banks, driven by commodity inflation concerns, is what Wilson identified as the primary source of current market anxiety and likely the final hurdle equities need to clear. He noted that part of last week’s brief rally coincided with falling bond volatility after Fed Chair Powell signaled a more neutral position.
Financial conditions are tightening, but Wilson observed that this dynamic could ironically create the conditions that allow the Fed to override its primary mandates. The key question, in his view, is whether conditions need to tighten further before they ease. He believes the issue will be resolved as the transition in Fed leadership is completed.
Morgan Stanley correction target range for S&P 500: 6,300 to 6,500
S&P 500 forward P/E decline from peak: 18%
S&P 500 price damage: less than 10%
Russell 3000 stocks down 20% or more: more than half
Median S&P 500 company EPS growth: double digits, fastest since 2021
Tax refunds year-over-year increase: more than 10%
Bull market start: April 2025, following 2022-2025 rolling recession trough
Wilson continued to favor a barbell approach. On the cyclical side, he highlighted financials, industrials, and consumer discretionary goods, where earnings remain strong and valuations have compressed. On the growth side, he pointed to the hyperscalers, where sentiment and valuations have also reset to what he called healthy levels.
Advertisement
The final phase of a correction is rarely clean, Wilson cautioned. Another retest is possible, particularly if rates or bond volatility push higher again. But he framed that possibility as consistent with a market continuing to carve out a low, not one entering a new bear market.
His closing message was direct: markets are already discounting a future that investors have not yet fully recognized. “Markets aren’t typically so gracious as to offer multiple opportunities,” Wilson wrote, which is why the bank has encouraged investors to be early rather than wait for confirmation.
Related: Barclays just made a surprising call on the S&P 500
This story was originally published by TheStreet on Apr 14, 2026, where it first appeared in the Investing section. Add TheStreet as a Preferred Source by clicking here.
Our recent survey research found that older investors are more concerned about their financial future due to greater uncertainty over federal policy.
This new analysis explores whether financial advisors can help them cope.
Advisors are broadly more optimistic than investors on the economy and on how policy actions might impact financial security.
But on the specifics, advisors express concern over Social Security, Medicare, federal debt, and inflation, with many urging precautionary actions.
This ambivalence may help explain why advisors have no significant impact on their clients’ views on the future or investment strategy.
Introduction
Planning for retirement has always been hard, because people face numerous risks – including outliving their money (longevity risk), investment losses (market risk), unexpected health expenses (health risk), and the erosive impact of rapidly rising prices (inflation risk). Further complicating such planning are possible shifts in the public policy environment: changes to social insurance programs can undermine the foundations of a retirement plan; changes to the tax system can scramble a household’s finances; and a ballooning government debt can increase interest rates and slow the economy. The level of policy risk seems to have increased dramatically since the start of 2025, so the question is how the recent uptick may be affecting the decisions and behavior of near-retirees and retirees.
This brief is the second of two drawn from a recent study on the potential impact of policy risk on planning for retirement.1 The first addressed that question by combining a summary of the academic literature on the nature and effects of policy risk with a new survey of the changes in the views and actions of near-retiree and retiree investors since the start of 2025. This second brief adds the results of a companion survey of financial advisors, which provides information about what advisors are thinking regarding the uptick of policy risk in 2025 and what advice they are providing their older clients.
The discussion proceeds as follows. For background, the first section provides the major findings from the first brief. The literature review establishes that increased policy risk both harms the economy and burdens individuals. And the survey of near retirees and retirees indicates that older Americans are keenly aware of the increase in policy uncertainty and are taking defensive responses. The second section describes the 2025 Survey of Financial Advisors and presents the results. The final section concludes that, while older investors are worried and taking steps, financial advisors are ambivalent. This group retains a generally positive view of the economy despite recent developments, yet harbors some specific concerns. This ambivalence may explain why advisors have no impact on their clients’ views on the financial future or on investment decisions.
Policy Uncertainty and Response of Households
Advertisement
To be clear, “policy risk” is not about policy change, per se, but rather about the unpredictability of future policy. Even without any change to current policy, for example, a tight and polarized election forces households to consider a wider range of policies than if the election outcome were certain or the policy positions of the candidates were similar.
Major Findings from the Literature
Researchers have used an array of techniques to measure the level of policy risk and its impact. The most common approach is textual analysis of media coverage for terms associated with policy risk.2 But other approaches include looking at the impact of actual variability in policy parameters, estimating the impact of tight elections, and using surveys to gauge household perceptions of policy uncertainty and their likely responses.
The effects of policy uncertainty on the economy are broadly negative. In terms of the macroeconomy, uncertainty depresses economic activity, increases stock-market volatility, and reduces returns.3 Similarly, unemployment is found to rise in the face of greater uncertainty, while consumption and investment tend to fall.4
For those approaching retirement and retirees, the most salient risks are related to Social Security, Medicare, and fiscal policy (e.g., the federal debt and tariffs). In terms of Social Security, the big question is how policymakers will address the projected exhaustion of assets in the retirement trust fund in 2033 – raise payroll taxes by 4 percent, cut benefits by 23 percent, or some combination of the two. With regard to Medicare, while its finances are generally structurally sound, the issue is whether policymakers will continue to tolerate the program’s growing costs, which create an ever-increasing drain on federal revenues, or cut the program by raising either premiums or copayments. In terms of the ballooning federal debt, the risks are rapidly rising interest rates on Treasury securities, which cascade through to other forms of borrowing, and/or a major increase in taxes or a decline in spending.
Advertisement
As individuals take precautionary steps to protect themselves against policy risks, studies have shown that scaring people to take actions that they would not have taken in a stable environment has real costs. In the context of fixing Social Security, for example, researchers have found that individuals would be willing to forgo as much as 6 percent of expected benefits or 2.5 months of earnings to resolve the uncertainty.5
Results from the 2025 Retirement Investor Survey
The survey of near-retirees and retirees was conducted by Greenwald Research between July 7 and July 31, 2025. The sample consisted of 1,443 individuals ages 45-79 with over $100,000 in investable assets.
Throughout 2025, policy changed in drastic ways, and long-term trends in Medicare and Social Security financing have become more concerning. New deficits added to the already huge federal debt, and tariffs became a major source of anxiety. Not surprisingly, survey respondents have dramatically increased their consumption of media on these issues (see Figure 1).
It should therefore come as no surprise that near-retirees and retirees in the 2025 survey expressed concern about the direction and unpredictability of federal policy. Investors’ concerns for their financial future mounted (39 percent say concern increased versus 15 percent who say it decreased), while their confidence that federal policy will benefit Americans declined (61 percent decreased versus 26 percent increased, see Figure 2).
Advertisement
These older investors have already reacted to this unpredictability in several ways (see Figure 3). For example, 21 percent of the unretired respondents in the sample have decided to postpone their retirements. And, on the financial side, 28 percent of the entire group have increased the amount in their emergency fund, and 33 percent have shifted to more conservative investments.
In short, the evidence shows that older Americans are keenly aware of the increase in policy uncertainty and are taking defensive responses.
How Do Financial Advisors Differ from Investors and What Role Can They Play?
One group that could help older Americans cope with the heightened level of policy uncertainty is their financial advisors. To find out what advisors are thinking and what advice they are offering, the second survey interviewed 400 financial professionals. Each professional was required to have at least 75 clients, at least three years of experience at their current firm, and to manage over $30 million in assets. Furthermore, at least 40 percent of their clients must be 50 or older, and at least half their income must be derived from financial products or planning. These advisors represented a cross section of firms, including broker-dealers, registered investment advisors, insurance companies, banks, and full-service financial services firms.
The advisor survey reveals a different view of the retirement landscape and its susceptibility to policy risk than the investor survey, but also a nuanced one. On the one hand, advisors have a much rosier view of the economy in general. In particular, while 53 percent of near-retirees and retirees say the economy deteriorated between 2024 and early 2025 and only 26 percent say it improved, the numbers for advisors are nearly flipped, with 47 percent saying the state of the economy improved and only 25 percent saying it weakened (see Figure 4).
And while investors say the government’s future actions will weaken their financial security by a nearly two-to-one margin (47 percent versus 24 percent, see Figure 5), the views of advisors are again very different. Only 31 percent of advisors believe the government will weaken their clients’ finances, while 36 percent believe government actions will be positive.
On the other hand, even advisors seem to be recommending greater caution in response to the turbulent environment in 2025. In particular, 22 percent have recommended that their clients increase emergency savings since the beginning of 2025, as opposed to 3 percent recommending a decrease (75 percent recommend no change, see Figure 6). And the amount of attention advisors pay to political and policy issues has also increased since 2024 – 54 percent say they pay more attention to these topics than last year, as compared with 5 percent saying the opposite. Advisors’ level of concern about their own clients’ financial future also reveals their general unease: 28 percent say they are more concerned about their clients’ financial future in 2025 versus 2024, while only 9 percent say they are less concerned.
The advisors’ positive outlook for retirement is also somewhat contradicted by their concern regarding specific policy risks. Figure 7 shows that advisors are worried or very worried about a variety of risks. In fact, 63 percent report being worried about a major decline in the stock market, 65 percent are worried about a cut in Social Security benefits, and 79 percent about high inflation. Figure 7 also shows investor responses where the questions were similar to those for advisors. Notably, clients rank these risks quite similarly, but are almost uniformly more worried in absolute levels. Interestingly, both investors and advisors consider the federal debt to be the most concerning of the different topics.
The underlying pessimism of advisors beneath their overall positive sheen has some specific implications. While the vast majority of advisors either do not recommend a retirement age to their clients or did not change their recommendations between 2024 and 2025, 11 percent advised a later retirement age. Only 1 percent shifted in favor of earlier retirement (see Figure 8).
Moreover, the vast majority of advisors have recommended that their clients take precautionary actions in light of anticipated policy changes (see Figure 9). In particular, 21 percent have suggested cutting back spending; 49 percent have suggested changes to investments; 43 percent have suggested acquiring financial products to hedge investment losses; and 42 percent have suggested reallocation of resources, such as Roth conversions, based on the projection of higher future taxes. Only 21 percent have not recommended any of the above actions.
Of those advisors who recommended changes in investment strategies in 2025 relative to 2024, most suggested a more conservative allocation. Twenty-five percent chose that option, relative to 18 percent who recommended a more aggressive strategy (with 21 percent suggesting a mix and 36 percent suggesting no change; see Figure 10).
When asked about their personal investments, 29 percent of advisors say that the importance of protecting their assets has increased since 2024, while only 4 percent say that the need to protect assets has become less important, with 66 percent saying their views have not changed (see Figure 11).
Overall, the pattern of responses from advisors paints a picture of frothy optimism at a high level, coupled with fundamental concern about the implications of policy on financial security. When asked in any great detail about specific policies or about the appropriate posture to strike between conservative and aggressive investment behavior, the advisors generally display an increased preference for safety as opposed to chasing returns. Putting on a brave face despite underlying concerns may be a response to clients’ need for reassurance.
The ambivalence in advisors’ views may help explain why they do not appear to have much impact on their clients. Regression results show that the correlations between having a financial advisor, on the one hand, and the change in investors’ concern for either their investments or their financial future, on the other, are statistically insignificant in both cases (see Figure 12).
Conclusion
While policy uncertainty has been much studied, big questions remain about the impact of the apparent dramatic uptick in policy risk. Our first brief on this topic showed that near-retiree and retiree investors have grown significantly more concerned about their financial well-being since the start of 2025. Even for this sample of relatively wealthy households, the potential for substantial cuts in Social Security was the major concern. In response to these risks, a meaningful share of these groups have taken steps to protect themselves, such as increasing their emergency fund and moving to more conservative investments, and those still working have delayed their retirement date.
Advertisement
One resource that could help older Americans cope with the heightened level of policy uncertainty is their financial advisors. Advisors, however, seem conflicted. They are generally optimistic about the economy overall, with 47 percent saying they think that the economy is stronger since the start of 2025, and only 25 percent reporting they think it is weaker. On the other hand, advisors express concern about a broad array of developments, and most of those recommending changes for their clients suggest cautious actions, such as delaying retirement or moving to more conservative investments. The ambivalence in advisors’ views may help explain why they do not appear to have much impact on their clients’ confidence. The correlations between having a financial advisor, on the one hand, and the change in investors’ concern for either their investments or their financial future, on the other, are statistically insignificant in both cases.
References
Alexopolous, Michelle and Jon Cohen. 2015. “The Power of Print: Uncertainty Shocks, Markets, and the Economy.” International Review of Economics & Finance 40: 8-28.
Baker, Scott R., Nichola Bloom, and Steven J. Davis. 2016. “Measuring Economic Policy Uncertainty.” The Quarterly Journal of Economics 131(4): 1593-1636.
Boudoukh, Jacob, Ronen Feldman, Shimon Kogan, and Matthew Richardson. 2013. “Which News Moves Stock Prices? A Textual Analysis.” Working Paper 18725. Cambridge, MA: National Bureau of Economic Research.
Advertisement
Fernandez-Villaverde, Jesus, Pablo Guerron-Quintana, Keith Kuester, and Juan Rubio-Ramirez. 2015. “Fiscal Volatility Shocks and Economic Activity.” American Economic Review 105(11): 3352-3384.
Leduc, Sylvain and Zheng Liu. 2016. “Uncertainty Shocks are Aggregate Demand Shocks.” Journal of Monetary Economics 82: 20-35.
Luttmer, Erzo F.P. and Andrew A. Samwick. 2018. “The Welfare Cost of Perceived Policy Uncertainty: Evidence from Social Security.” American Economic Review 108(2): 275-307.
Munnell, Alicia H. and Gal Wettstein. 2026. “How Policy Risks Affect Retirement Planning.” Special Report. Chestnut Hill, MA: Center for Retirement Research at Boston College.
Shoven, John B., Sita Slavov, and John G. Watson. 2021. “How Does Social Security Reform Indecision Affect Younger Cohorts?” Working Paper 28850. Cambridge, MA: National Bureau of Economic Research.
