Financial Confidence

The average income for Americans grows an
astounding 111% from the under-25 age bracket
to the 25–34 bracket. After that, income growth
rate slows to 33% between the 25–34 bracket to
the 35–44 bracket. Income continues to slow to
a mere 1% growth rate between the 35–44 age
bracket and 45–54 bracket, and then hits -6% by
the time people reach the 55–64 age bracket. So,
while college students and recent graduates may
only have an entry-level salary, their earnings are
also likely to climb dramatically as they become
full-fledged members of the workforce. That
makes it more likely that they’ll have the cash
flow to at least cover their current expenses and
debt payments—keeping confidence levels high.
However, as people reach their mid-30s and 40s,
their salaries begin to stagnate and eventually
decline by the time they hit their mid-50s and 60s 7
(likely due to near-retirees leaving their positions
as they prepare to retire full-time).
11 Financial Confidence: Examining the U-Curve—and How We Might Improve the Confidence Trajectory