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Americans Save Next to Nothing, Living Paycheck to Paycheck

Image: Americans Save Next to Nothing, Living Paycheck to Paycheck
Piggy bank balancing on seesaw over a stack of bills. (Pogonici/Dreamstime.com)

By    |   Tuesday, 31 Mar 2015 09:58 AM

Americans are saving next to nothing seven years after the recession, leaving many people's lives vulnerable to total upheaval if they were to lose a job, have a medical emergency, or undergo another other sudden event.

NeighborWorks America, a national non-profit cited by USA Today, recently surveyed over 1,000 adults and found that 34 percent said they had no savings they could use in an emergency and 47 percent said their savings could support them for 90 days or less.

"We're concerned because our survey shows that many people are still digging themselves out of the hole that they found themselves in during the Great Recession," said NeighborWorks CEO Paul Weech.

Making matters worse, CNN Money highlighted a new report released by Bankrate.com on Monday that showed dangerously low savings rates among Americans.

The survey of over 1,000 people revealed that 18 percent of respondents were saving nothing from each paycheck, while another 28 percent were saving 5 percent or less.

The common rule of thumb for savings is 15 percent of income.

"Between emergency savings and the ever-increasing burden of retirement savings that is on the individual, the goal should be 15% of your income," said Greg McBride, Bankrate's chief financial analyst.

Households earning between $50,000 and $74,999 a year were doing better than most, saving 10 percent of their incomes, but very few were saving anywhere near 15 percent.

"The burden of retirement savings is increasingly upon us as individuals, and the need for emergency savings is ever present,'' said McBride. "The meager savings rate isn't going to cut it."

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Americans are saving next to nothing seven years after the recession, leaving many people's lives vulnerable to total upheaval if they were to lose a job, have a medical emergency, or undergo another other sudden event.
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2015-58-31
Tuesday, 31 Mar 2015 09:58 AM
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