Trying to manage money for today, as well as conserving it to set up a strong financial future, can be a difficult task to balance for many Americans. Struggles with this may continue for a number of individuals, as they try to get their money situation right.
Close to one-third of Americans noted that they are progressing well in their quest to save money properly, according to a report completed between the Consumer Federation of America, the American Savings Education Council and its manager EBRI. Despite this, 63 percent said that they were not making much progress on their savings aspirations.
“Only about one-third of Americans are living within their means and think they are prepared for the longterm financial future,” said Stephen Brobeck, executive director at the Consumer Federation of America. “One-third are living within their means but are often not prepared for this longterm future. And one-third are struggling to live within their means.”
However, there are some positives among the American population when it comes to savings. The report showed that nearly 70 percent of those polled are spending less money than they are earning, and also putting away the remainder in their savings accounts.
“Individuals continue to become more realistic about the need to save and plan themselves, rather than assume it will be done for them,” said Dallas Salisbury, CEO, president and chairman of EBRI. “Increased knowledge about the Social Security and Medicare programs, as well as the potential costs of Long Term Care, and longevity risks, continue to dampen expectations for an early and golden retirement.”
Nearly two-thirds of those polled explained they have enough money put away in emergency savings in order to pay for an expense that they didn’t plan for, the report noted. More than 75 percent said that they are in the process of cutting debt levels, or are without any debt.
Americans look to improve finances
The early part of the year can be a great time for some to look at their financial situation and try to improve upon it. According to a report from Fidelity Investments, more than half of Americans noted that they will attempt to stick with a financial resolution throughout this year.
Nearly 55 percent of Americans noted that they will try to increase the amount of money they usually save, the report explained. Another 24 percent specified they will try to lower their debt, and 19 percent want to cut their overall spending.
“These findings suggest individuals are taking more control over financial matters, leading them to feel better about their personal situations, which is a great way to ring in the New Year,” said Ken Hevert, vice president of retirement products for Fidelity Investments.
Some aspects of personal finance management may be improving for Americans. The report added that 26 percent of those polled were in a better financial situation at the start of this year than they were in 2013. Last year, just 19 percent said this.
Individuals struggle with debt
The overall sentiment among Americans may be to get their financial situation on track, but many hurdles may be in the way. Just 51 percent of individuals have more savings for emergencies than actual credit card debt, according to a report from Bankrate.com. This was lower than any other reading since 2011.
“This is a reflection of the stagnant incomes, long-term unemployment and high household expenses that are hampering the financial progress of many Americans,” said Greg McBride, chief financial analyst at Bankrate.com.
Nearly 30 percent of Americans are dealing with a higher level of credit card debt than the total of their emergency savings, the report added. Another 17 percent of those polled don’t have either credit debt or money saved for emergencies.