Money Tips: Almost 70% of Americans Have Savings Under $1,000

(Money Tips)

(Money Tips) — New research shows that nearly seven out of ten Americans have under $1,000 in savings. Two main causes have been identified for the nation’s poor savings habits. First, credit cards and other payment options like Apple Pay have made spending easier than ever. Second, some people are living beyond their means. Not only are they unable to save, but any existing savings are siphoned away. Experts stress the importance of setting aside some income for future stability.

New data reveals that 34 percent of Americans have nothing in their savings account, while 35 percent have below $1,000. Of the remaining cross-sector, 15 percent have over $10,000, 4 percent have saved between $5,000 and $9,999, and 11 percent have managed to save between $1,000 and $4,999. Despite low-income adults finding it a bigger struggle to save than other earners, none of the income groups was particularly smart with their money. For example, 44 percent of those earning between $100,000 and $149,000 had less than $1,000 in savings.

With the St. Louis Federal Reserve household savings rate for July 2016 at 5.7 percent, it is important that people recognize the problem. Saving the recommended 10–15 percent of their annual income would prevent people facing financial problems when they receive unexpected bills, such as medical expenses or car repairs.

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