A new survey out this week revealed that more than a third of Americans have less than $1,000 put away for a rainy day. “It’s a startling revelation, but Americans, even in good times, have been historically lax in saving for the future, at least for three decades. Thirty-odd years ago we were saving at rates of 10, 11 and 12 percent of our incomes. Today we’re setting aside a little more than four percent, on average, for emergencies and retirement,” Weber added. “It’s not enough but it’s also not surprising with job creation at unacceptably low levels and unemployment and underemployment rates that have remained consistently high ever since President Obama took office.”Share
Weber said he believes that there are other reasons people aren’t saving enough money in the U.S. They range from personal spending choices to a lack of government incentives for low and middle class workers.
For example, he said, a recent report by the Consumer Federation of America notes that only one-third of the U.S. population lives within its means and feels comfortable about the future, one-third are just able to live within their means and another third are struggling. Meanwhile, an analysis by the Pew Charitable Trusts showed “low income Americans receive less than one percent of so-called federal tax benefits compared with high income earners who receive as much as 70% of tax code benefits.”
“The French and the Irish save as much as 16% and 19% of their incomes, on average, compared to Americans who save less than 4.5% of their earnings. It’s one area where the U.S. falls dangerously short of the mark as a trend-setter.” (Read more.)
Happy New Year!
17 hours ago
3 comments:
Government policy makers have done everything possible to drive debt creation and destroy the value of our money by inflation, to the point where it's a wonder anyone has any savings at all. For the past 4 decades, at least, policy has been driven by our financial oligarchy, which has grown disproportionately rich from the expansion of credit and currency inflation, and which would derive no benefit from a solvent, frugal, careful population of savers who are not paying the massive "spread" between the almost- zero interest that financial institutions pay on deposits, and the much larger- and theoretically unlimited- interest charged consumers.
ZIRP provides no incentive for savings, to say the least, and it is driving inflation, which makes it impossible for families with stagnant incomes to stay even, let alone have a surplus to save. It is extremely discouraging to the average wage earner to watch the value of his stagnant or dropping earnings be eroded by rampant inflation, which I'm sure you do not need me to tell you is far greater than the 2% the Fed says it has yet to meet.
When I went to Africa in the 1970's to work as a missionary, I had a year's salary in the bank. When I came back five years later, I found inflation had made it worth half of what it was.
Same thing now.
Thank the Federal Reserve, and thank Richard Nixon for departing from the gold standard, for that inflation.
Our government is a dope-pusher, literally shoving consumer credit down people's throats and then touting the purchases made with that credit as economic progress. Most of the people buying $40,000 GM cars with 0-down 7-year loans barely make $40K a year. And don't even get me started on the student loan debacle- to manipulate the fear of falling behind, and reasonable desire to better themselves, of young people who are not mature and experienced enough to know what it means to take out $100K or more in loans that cannot be discharged in bankruptcy, is absolutely criminal, yet this is what our policy makers and their oligarch owners have done to our youth. It sickens me.
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