Survey sheds new light on Americans' savings habits
Americans appear to be doing a better job of saving, with two-thirds reporting they have emergency funds and more than half saying they're saving at least 5 percent of their incomes, according to the latest American Saves Week survey.
As in previous surveys, those earning more tended to save more, but having a plan to save improved the odds at all income levels, said Stephen Brobeck, executive director of Consumer Federation of America, co-founder of America Saves. He credited an improved economy as well as rising consumer confidence that encouraged people to make long-term savings plans.
"Higher incomes make it easier to save," Brobeck said. "Our survey found a strong association between having a savings plan with specific goals and savings success."
And having a plan is, of course, what America Saves Week is all about. The annual campaign to encourage savings among low- and moderate-income households launched Monday with about 1,700 organizations taking part. Events include a contest with a chance to win $500 for those who post a photo and their savings goal using the hashtag #imsavingfor on a social media platform.
Reaching young adults is a key goal for the campaign, which may find a more receptive audience than in the past. The survey showed young adults aged 18 to 34 -- whose economic prospects were so dented by the Great Recession -- putting more money aside, said Dallas Salisbury, CEO of Employee Benefit Research Institute and chairman of American Savings Education Council, a co-founder of America Saves. The percentage saying they save at least 5 percent of their incomes rose from 50 percent last year to 56 percent this year, while those reporting enough savings to pay for unexpected expenses such as car repairs or a doctor's visit rose to 64 percent, compared to 53 percent last year.
Overall, the percentage reporting an emergency fund rose in lockstep with incomes, with 45 percent of those earning less than $25,000 reporting enough savings to cover an unexpected expense, compared to 91 percent of those earning more than $100,000. (Although you have to wonder what's going on with the nine percent in that bracket who can't cover a car repair.)
The telephone poll of more than 1,000 U.S. adults found "small improvements in numerous savings indicators," Salisbury said. Those saving at least 5 percent of their incomes rose from 47 percent to 52 percent, while those having an emergency fund rose from 64 percent to 66 percent. The proportion saying they were making good to excellent progress in saving rose from 35 percent to 40 percent.
A majority, 55 percent, said they were saving enough for retirement, while 28 percent said they were saving more than 10 percent of their incomes, according to the annual survey.
