You may have heard generalizations in the recent past that almost half of America couldn’t immediately come up with $500 or $1,000 to cover an emergency expense. These numbers vary, but Bankrate.com has released a figure that one in five working Americans are not saving any money out of their pay at all.
This is scary on the surface and it means that one in five also are going to have zero cushion to fall back on if and when the economy or the job market inevitably turn for the worse. That means no retirement savings, no funds being saved for the next emergencies, and no savings to meet other financial goals.
The reasons why 20% of Americans still are not saving money are pretty common. Of the non-savers, 39% (the largest response) of them said that they have a lot of expenses. Another 16% cited that their job isn’t good enough to allow them to save. Some 16% simply said that just have not gotten around to saving. And 13% of the non-savers cited debt.
And the debt issue may be somewhat of a broken metric when it comes to pointing the finger at any one debt. Those who cited debt as the reason for not saving tended to be those with higher incomes, including 17% of those making more than $75,000.
There may even be a political angle as well. Bankrate.com said that Republicans blamed debt more often than Democrats, at a rate of 21% to 13%. Members on both political sides blamed debt more often than independents, who did so at a rate of 10%.
All in all, this may feel like a story of the “haves versus the have-nots.” Yet, those who are managing to save are apparently saving up quite a bit. Of those Americans who are saving money, 27% of them are saving more than 10% of their pay. And there are 16% who said that they are saving more than 15% of their paycheck. About three-quarters of working Americans are saving something from their paychecks.
Bankrate.com identified which groups are saving as follows:
Among age groups, younger Millennials (aged 18-27) were second only to seniors between the ages of 64 and 72 years-old. 23% of younger millennials and 27% of older boomers are saving more than 15% of their incomes. Underscoring the potential value of education, more college grads (21%) were saving 15% or more of their incomes than those with some college (18%) or high school educated or less (just 9%)…. Some 1-in-5 Millennials (age 18-37) said their jobs weren’t good enough (the second most common reason cited by them). More than a-quarter (27%) of the Silent Generation (73 and older) said they don’t need to save more.
Bankrate.com said that the interviews were conducted from February 28 through March 4 from a sample of 1,010 respondents, of which 501 are employed.