Having some money set aside in your savings account is crucial because you never know what life brings, and in case of an emergency like a health emergency where you need to come up with some money without crippling your economics, you need those savings.
However, according to a survey, most Americans have less than $1,000 in savings, which can’t help with anything if there is an emergency.
We will examine the important findings of this survey and why they can’t save more.
- In a survey, 45% of all the respondents stated that they do not have any savings.
- 24% said that their savings account has less than $1,000.
- 33% said that they are living paycheck to paycheck.
- 38% said that if they had a higher salary, they would be able to save more.
In this survey about Americans and their savings, some important findings put a clear picture of the habits of savings in Americans and the key characteristics.
The most important thing is that almost 45% of all the respondents stated that they do not have any savings at all, meaning that they have no money sitting in their savings account in an emergency, and another 24% said that their savings account has less than $1,000.
More importantly, out of all the people, only 20% said that the high cost of living is putting a blockage in their path to saving more.
About 33% said that they are living paycheck to paycheck, which is the main reason behind not being able to save more. 18% of respondents also stated that if they had less debt than they have now, they would be able to save more.
Another 38% said that if they had a higher salary, they would be able to save more, at least more than they are saving now.
In addition, out of those who have some sort of savings, whether higher than $1,000 or not, only 33% of them use savings accounts and store cases in case of an emergency.
Others do not even have any savings account to store their cash. When we compare the statistics, In 2017, 57% of the same survey’s respondents said that they have less than $1,000 in savings, and in 2018, this number increased to 58%. There wasn’t much increase, but in 2019, this rate now sits at 69%.
Why Americans Do Not Have Savings
Even though there is no clear picture as to why most Americans have less than $1,000 in savings and some have no savings at all, some major reasons for most Americans do not have any savings are the high cost of living or the low salaries.
Cost of living seems to be the biggest reason for people not saving any money because 33% of people in the survey stated this reason.
The same reason was 31% in 2018. Even though there was a small increase, it shows that the cost of living is increasing and affecting Americans.
In conclusion, many Americans are living paycheck to paycheck and can’t afford to put some money aside for themselves in case of an emergency.
Americans state that the reason most of them have less than $1,000 in savings is that the cost of living is too high or their paycheck is not enough to cover their needs every month.
What is the savings percentage of the U.S. population?
The savings percentage of the U.S. population is hovering between 5-5.5% as of June 2022, which is significantly lower than the savings percentage of 16.3% in 2020.
What amount of money does an average U.S. citizen have in their bank account?
As per the latest SCF data, an average American has $5,300 in their bank accounts.
How much savings is too much?
The Federal Deposit Insurance Corporation has set a limit of $250,000 for a savings account, and anything more than this indicates too many savings.
Amit Gupta is the founder of National Planning Cycles, a company that helps startups, individuals, and small businesses with their financial planning. He has a vast amount of experience in the finance sector, having managed Google Play accounts for some of the world’s most successful unicorns. Amit is an expert in his field, and he uses his knowledge to help others achieve their individual goals.