Extension Educator, Consumer Economics
Saving money is a challenge. The fifth annual national survey assessing household saving revealed that, despite hopeful macroeconomic signs, an increasing number of Americans are having difficulty saving money: from saving for emergencies to affording retirement. Over the past three years, the number has declined who
· spend less than their income and save the difference,
· are building home equity,
· have adequate emergency savings, and
· think they are saving enough for retirement.
However, the survey also revealed that having a savings plan is beneficial, even for lower-income families. People with a savings plan are much more likely to spend less than their income and save the difference and to say they have adequate emergency savings. Creating a financial plan – and having a clear goal – can help people save regularly. After all, if you don't know why you're saving money, then it's much easier to spend money freely on immediate needs or wants!
This year's survey results show that 66% of those surveyed said they "have sufficient emergency savings to pay for unexpected expenses like car repairs or a doctor's visit." And, only 52% of those non-retired think they are "saving enough for a retirement in which they will have a desirable standard of living." Unfortunately, these percents have been falling for the past three years.
The survey was released the Friday before America Saves Week, an annual event where hundreds of national and local organizations promote good savings behavior and individuals are encouraged to assess their own saving status. America Saves and the American Savings Education Council coordinate this annual effort. Many local organizations, including University of Illinois Extension, participate in this national effort.
Why do we participate? Because saving money regularly is essential to long-term financial security. America Saves encourages people to set a savings goal and to regularly save money.
How would you answer the questions if you were surveyed? Do you feel that you have sufficient emergency savings? Are you satisfied with your savings for other goals? If not, now is the time to make a change: to either start saving regularly or to increase the amount you are saving.
I encourage you to join America Saves. When you join America Saves you will set a savings goal and then receive free newsletters and access to online tools such as the "My Savings Tracker." Go to champaigncountysaves.org to enroll and to access local educational resources as well.
Joining America Saves can help you because you'll receive regular reminders of your saving goal. Small, friendly, encouraging nudges are often helpful to develop new habits such as a savings habit.
And, there's a new saving tool available that may also prove to be fun and motivating for you. America Saves has partnered with SaveUp, the nation's first free rewards program for saving money and reducing debt. SaveUp is available for free to Americans who bank at more than 18,000 US financial institutions.
Unlike traditional rewards programs that focus on driving consumer spending, SaveUp rewards users with credits for performing positive financial actions, such as contributing to their savings or retirement accounts; paying down their credit cards, mortgages or other loans; and engaging with SaveUp's financial education content on the site. SaveUp users can use their credits to play for exciting rewards such as retail gift cards, electronics, vacations, home makeovers, cars and even a $2 million jackpot.
I've tried the new SaveUp program and find it very intriguing. If you like playing games online, check this out. If you're a person who enjoys the excitement of playing the lottery, this may give you the same "buzz" and you will save money rather than spend it!
If you find it difficult to save regularly, joining a program that gives you positive feedback for saving money might make a difference. Give it a try! Visit champaigncountysaves.org to get started today.