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Financial Risk Taking: The Risks Americans Are Willing to Take With Their Money [Ranked]

How Your Car Insurance Coverage Works and Which Factors Impact Costs [2021]

A little over a year ago, a global pandemic wasn’t a major concern on most people’s radar. Then, COVID-19 spread worldwide, causing unprecedented health and economic consequences that impacted millions of people. Unsurprisingly, the pandemic changed almost every aspect of our lives — including our financial lives.

DadeLoan surveyed 1,000 U.S. adults, half of whom had tested positive for COVID or had a family member who had tested positive. Our goal was to better understand how the coronavirus affected financial behaviors and whether Americans have become more or less cautious in their financial lives.

Key results

  • 48% of respondents said the COVID-19 pandemic has made them less likely to take financial risks, while 1 in 5 say they’re more likely to take financial risks.
  • 48% of people view visiting a grocery store with no mask as “extremely risky,” compared with just 24% who view investing in Bitcoin as presenting a similar risk level. Other behaviors considered “extremely risky” included driving without insurance (60%), not having health insurance (48%), and flying during the pandemic (34%).
  • 1 in 5 Americans increased their life insurance coverage during the past year. Of those who tested positive for COVID-19 or had a close acquaintances test positive, 28% purchased additional coverage.
  • 43% of survey respondents don’t have a will or an advanced directive providing end-of-life instructions. Just 33% have both.
  • 15% of U.S adults have used a check cashing service since the start of the pandemic, while 13% have taken a paycheck advance and 12% a payday loan. Another 14% sold items at a pawn shop.
  • One in 10 respondents are pessimistic about their financial outlook for 2021, despite the challenges they’ve faced.

Overall, we’re taking fewer financial risks because of COVID-19

As Americans have experienced economic and personal turmoil due to COVID-19, 48% of respondents indicate they’re less likely to take financial risks than they were a year ago. It’s not surprising people have become more risk-averse with their money since the pandemic caused economic turmoil and record levels of unemployment.

However, what may come as a shock is that a substantial number of individuals — 1 in 5 respondents — actually indicated they were more likely to take financial risks due to COVID-19. These individuals may have faced financial setbacks they’re hoping to recover from, or they may have been unaffected personally by the pandemic’s turmoil and see opportunities in the economic disruption.

There was an even sharper decline in financial risk tolerance among those personally affected by the pandemic. A majority (55%) of individuals who either tested positive for COVID themselves or who had a close acquaintance test positive indicate they have become more risk-averse as a result.

What do you consider “risky” in a pandemic?

As social distancing measures have been put into place and the virus has continued spreading, the definition of “risky” behavior has also changed. Forty-eight percent of respondents now view once routine activities like visiting a grocery store without a mask as “extremely risky.”

In fact, respondents cited maskless store visits as the second riskiest-activity — 60% felt driving without auto insurance was the riskiest activity. Surprisingly, going without health insurance was viewed as just the third-most dangerous activity, with only 48% describing this decision as carrying “extreme” risk.

Investment choices, by contrast, ranked relatively low on the list of risky activities. Just 24% of survey respondents described investing in Bitcoin or other cryptocurrencies as “extremely risky,” despite the fact this type of investment is considered very volatile.

Close to the same percentage — 18% — described investing in the stock market as carrying a high level of risk, despite the possibility of losing the money you invest. Market volatility due to the pandemic may have impacted how Americans perceive the risk of investing in equities. In general, however, the stock market has a much longer history of consistently producing returns over time than newer and more speculative investments like Bitcoin.

Insuring ourselves against the worst

Purchasing life insurance is one way to minimize financial risk, as it can help protect loved ones in case of an untimely death. And the pandemic has undoubtedly led to many more Americans considering their mortality and safeguarding their family finances.

In fact, 20% of individuals who weren’t personally impacted by COVID increased their life insurance coverage, even though neither they nor a close acquaintance tested positive for the virus. Those who tested positive for coronavirus or had a close family member or friend who tested positive were even more likely to up their insurance coverage. Twenty-eight percent of this group bought more life insurance.

Purchasing coverage from the best life insurance companies could be one of the smartest financial moves you make, not just in response to the virus but in general. The right life insurance coverage can give you peace of mind and help ensure your loved ones are cared for if something happens to you. That’s because life insurance works by paying out a death benefit if you pass away while covered by your policy. With some newer life insurance companies like Bestow offering policies that don’t require a medical exam, applying for a policy is easier than ever.

Disability insurance and health insurance have also become more desirable to Americans during the pandemic. Fourteen percent of respondents increased their disability coverage over the past year, and 23% bought more health insurance. In addition, 6% signed up for disability plans for the first time.

While life and disability policies have increased in popularity, 37% of Americans still view health insurance as the most essential type of coverage, describing it as the riskiest type of policy to go without.

Going without a will

While Americans may have increased their insurance coverage due to heightened fears about their mortality, these concerns haven’t prompted as many people to either make a will or prepare an advanced directive.

Just 33% of respondents said they have both a will and an advanced directive, while 43% have neither. Both documents are essential, as a will allows you to provide instructions regarding guardianship of children and inheritance of property, and advanced directives give you the power to specify what type of life-saving care you’d want in case of incapacity.

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Tough money decisions in tough times

Americans may be feeling more risk-averse during the coronavirus pandemic because they are already facing upheaval in their financial lives. Unemployment hit record highs in the past year as many businesses were forced to close, and finding new work became a high-risk proposition in many cases.

With so many workers experiencing reduced hours or job losses, it’s not surprising that close to half of survey respondents indicated they had missed an insurance or debt payment since March 2020. Auto payments were the most commonly missed; 19% failed to pay their car loan, compared with 13% who paused payments on student loans and 16% who didn’t pay either their rent or mortgage. Missing insurance premium payments was also common, with 15% reporting that they failed to pay their health insurance and 16% skipping a life insurance payment.

The relatively low rates of missed payments on student loans and mortgages may be explained by the fact that federal coronavirus relief legislation enabled many borrowers with these types of debts to pause payments by putting them into forbearance.

Among those who missed payments, loss of employment; a decrease in wages; and a decrease in unemployment benefits were leading reasons for the inability to pay the bills.

Risky financial behaviors

Although many people reported the pandemic made them more cautious about their money, plenty of individuals have engaged in some high-risk financial behavior resulting from the pandemic.

In fact, 17% of survey respondents admitted to trying out day trading since March 2020. This type of speculative trading always presents risks, especially in light of the market volatility the pandemic caused.

Many also made risky moves with regards to borrowing. A total of 17% of respondents maxed out credit cards, 15% used check-cashing services, 13% used paycheck advances, and 12% took out payday loans. Another 14% sold items at a pawn shop. These decisions may have been made out of desperation, not because Americans wanted to put their long-term financial security on the line with costly borrowing options.

Unfortunately, credit card interest, check cashing services, and payday advances or payday loans can come with high interest charges, causing far-reaching financial consequences as future income has been committed to repaying these costly debts.

Lending a helping hand despite the financial risk

While there’s been plenty of bad news surrounding the pandemic, there is also some good news — Americans have remained generous despite financial struggles. In fact, 38% of survey respondents gave money to struggling family or friends, while another 25% provided a loan to loved ones facing hard times.

Many also helped people they care about to gain access to credit, with 11% cosigning a loan and 13% adding someone as an authorized user. While cosigning and adding an authorized user can make you legally responsible for debts that person incurs, it can also make the difference between that individual being able to access credit or being denied.

Despite it all, there’s optimism for the year ahead

Finally, there’s a little bit more good news to share — most people are excited about moving forward to a brighter tomorrow. In fact, while one in 10 survey respondents was pessimistic about the financial outlook for 2021, close to half of all individuals were optimistic about what this year will bring.


DadeLoan surveyed 1,000 U.S. adults ages 18 or older, who comprise a nationally representative sample, on January 15, 2021.

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