Originally published April 12 2015
Forty-seven percent of US households live paycheck to paycheck as families struggle to save money in poor economy
by J. D. Heyes
(NaturalNews) There has been some good news lately regarding the U.S. economy: Jobs are coming back in appreciable numbers - finally - and more Americans are having an easier time earning a living than at the height of the Great Recession.
But there is still plenty of bad news, economically, in the world's richest country. For example, a new study has shown that almost half of American families live from one payday to the next.
According to Deutsche Bank's Torsten Slok, some 47 percent of Americans save no money at all.
As noted by Shane Ferro at Business Insider:
If it isn't obvious, this has a broad range of implications. People who don't save won't have any buffer should the economy turn and they lose their jobs. Longer term, people who don't save won't have the capacity to retire.
It's not good.
Almost 1 in 5 households are saving nothing at allAccording to a chart published with the report, Americans were not always so pressed. In 2001, 41 percent of households did not save; by 2010, just barely out of the official Great Recession period, that rate skyrocketed to more than 48 percent.
Today, it's not much better.
A separate report in U.S. News, quoting additional research from Bankrate.com, found that 46 percent of Americans put less than 5 percent of their annual incomes into longer-term savings instruments:
The study, which surveyed 1,000 adults living in the continental U.S. earlier in March, found that 18 percent of the U.S. was saving virtually nothing from year to year. Another 28 percent was building savings but hoarding less than 5 percent of annual incomes.
Greg McBride, a chief financial analyst at Bankrate.com, says even Americans saving the 5 percent of their incomes are not doing nearly enough.
"People are woefully under-saved, for both emergencies and retirement. I think these numbers tell us why. Not enough people are saving. Not enough people are saving enough," he said. "But there are those that are doing it. Almost a quarter of the population is saving more than 10 percent of their income. And even the lowest income households, about one in five, is saving more than 10 percent of their income."
The old rule of thumb is to save 10 percent - and pay yourself before you pay anyone else.
But tough times make for tough savings.
Credit card debt surpasses savingsMcBride said Americans thinking both retirement and saving for a rainy day (an emergency of some sort) ought to really be putting away 15 percent of what they earn annually. Such a lofty goal, for a number of earners, "seems like a long way off, but it's a destination. That may not happen overnight."
He says nearly one in four Americans, or 24 percent, are saving more than 10 percent of their annual income, according to the study. Those with middle class incomes of between $50,000 and $74,999 are the most active savers; 35 percent of earners in that group saved more than 10 percent of their annual take-home pay last year.
"The best savers are not the highest income households. They're middle income households," McBride said. "Saving is not a function of income. It's a function of having the ability to live within your means and save consistently."
The study also found that 37 percent of Americans have credit card debt equal to or higher than their savings, meaning any surprise expense could push them into the economic abyss.
One way to save more is to curb costs - obviously - and many Americans are able to do that by growing their own food - even suburban and urban dwellers, using Mini Grow Boxes from Food Rising, an initiative launched by NaturalNews editor Mike Adams, the Health Ranger.
You can make your own mini-grow boxes using common parts and tools, then learn how to grow your own food while dramatically improving your health, lowering your grocery bill and possibly even saving your life.
See the first in a series of videos introducing the boxes here.
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