Having enough money to retire is an important part of a person’s financial strategy, but there also needs to be a plan for when something goes wrong. Emergency savings can help a person through a difficult time, but many may not be prioritizing it.
A total of 49 percent of Americans noted that they are not confident that they know enough about personal finance topics, according to a report from RetailMeNot.com. Nearly the same amount said that they don’t have an emergency savings built up to carry them through one month without their normal pay.
“A large percentage of people surveyed report they are living without any sort of financial safety net,” said Trae Bodge, senior editor for The Real Deal by RetailMeNot. “Saving money is just one part of the financial literacy equation. It is also important that consumers spend wisely to be able to afford the items they need. Making small adjustments to shopping behaviors, like utilizing discounts for everyday purchases, in addition to putting away even a small amount each month, are important steps toward achieving overall financial health.”
While not everyone is keeping up with savings, those who are have a notable amount put away. The report noted that 52 percent of those polled had enough money to hold them over for more than one month. The average amount saved from this group was actually eight months.
Despite this, 25 percent of those with savings did not know what the actual amount in their account was, the report explained. A total of 30 percent of men did not know how much they had stashed away, while 20 percent of women said the same.
Some people are trying to improve their financial standing, but they aren’t open to seeking outside aid. The report explained that close to two-thirds are thinking about creating a personal finance budget, while approximately 52 percent noted they would like to set a goal in the future to improve an aspect of their finances.
More Americans want to save this year
A number of people may not be doing it, but saving money is something that people have more interest in doing this year. According to a report from GoBankingRates.com, nearly 40 percent of Americans noted around the holidays that they would like to save money in 2014. This was significantly higher than the next response, as just 29.3 percent felt they want to cut down their debt levels.
“Considering the typical debt hangover Americans experience post-holidays, it makes sense that ‘saving money’ and ‘paying down debt’ are popular resolutions this year,” said Jennifer Calonia, www.GoBankingRates.com editor.
While general savings was important to Americans, it is likely more geared toward saving for later life. The report explained that just 8.7 percent of those polled planned to create an emergency fund.
Retirement savings still important to many
While hanging onto money for emergencies is important, many people may need to find a balance between their savings for now and later in life. According to a report from TheStreet, approximately 85 percent of Americans felt they have to cut down on expenses now to save for later on.
“A lot has been written about retirement and how people should be saving more to live comfortably in their old age. But what people are still grappling with is whether there is such a thing as going overboard with retirement savings,” said Marilen Cawad, managing editor for TheStreet.
Close to 55 percent noted that they are concerned about their retirement savings level, the report added. Another 38 percent explained they are not happy with their current savings contributions.