Survey Shows 40% Don't Have More than $500 In Savings

[The Stig]

Original Story By CBS Philly (http://philadelphia.cbslocal.com/2012/10/19/survey-40-percent-of-americans-have-500-or-less-in-savings/)


By John Ostapkovich

PHILADELPHIA (CBS) — A survey of about 1,100 Americans finds that more than 4-in-10 respondents admit they don’t have more than $500 in readily accessible savings.

The survey is a kind of departure for CreditDonkey.com, a website that compares credit card deals. Not respondents all were poor. Some had big houses, big mortgages or 401(k)s, but still no more than five Benjamins to rub together right now.

Jill Michal, president and CEO of the United Way of Greater Philadelphia and Southern New Jersey, reacts to the lack of liquid assets.

“It doesn’t shock me, but it does scare me. You know, we often say that the reason so many people fall off the edge in a tough economy is that they’re standing way too close to it, and I think this is a perfect demonstration of that.”

Michal says there’s a lack of training in personal finances.

“This is about life skills. It’s not just about arithmetic and reading, but we have to be able to teach the next generation that we have to be able to save for our own futures and we have to be able to save for those risks that could come our way.”

Michal says United Way has programs that teach work- and life-skills, although she thinks a lot of this ought to be done in schools or homes.

In addition to the emergency savings question, the survey found that 54% of respondents don’t have a savings plan in place, and 45% are afraid they’ll never be able to save.

Yikes. So even during short term, localized SHTF events, these folks are going to get desperate fast if they can't use their credit cards to pay for essential items.

[TroubleShooter]

I say it is higher, like maybe 70%.................

[prepguide]

I would agree with TroubleShooter. I think its higher than 40% especially given the state of the current economy.

[ak474u]

Not at all surprising. Gas prices, food prices, etc. have depleted lots of people's reserves, especially since so many are out of work. I think even people who normally HAD reserves are tapped out if facing at least one family member out of work. My wife is a serial saver, so we're good, I just can't go out and buy stuff anymore like I used to. I'd love to know what percentage of those surveyed are maxed out on CCs as well.

[idahobob]

Now, I wonder if this article is talking about folks that have FRN's in a savings account in the bank.

IMHO, keeping ANY FRN's in the bank is downright foolish. Keeping a certain amount in an emergency fund that you can readily access is prudent.

Bob
III

[cwconnertx]

I have to admit to sacrificing liquidity to chase returns or save some money from time to time. I've depleted cash reserves to buy things at a good deal, and I've done the same things to make investments.

The one thing I hold on to and don't liquidate is my silver, I've sold a little when it peaked in the high 40's but bought it back and more since it came back down.

Liquidity is good, and I encourage it, unfortunately I often fail to heed my advice. I put too much in 401ks and IRAs, etc to chase tax savings. Lock up too much in investments that are illiquid from time to time. I do have at least 500, but as a proportion of my income and spending that is a sad joke.

So, I recommend liquidity but often have very little myself.

[Echo2]

I'm surprised the number isn't higher.

A lot of folks are maxed out well beyond their means...even if they have a larger income....they can't rub 2 nickles together.

[Fatty]

With the way the dollar is going, I've been buying things that will continue to have value regardless. Once I've reached the level I'm seeking, then I'll return to the FRN saving process. :) And that % has got to be closer to 75%-80%, esp if you count those who can't even get unemployment benefits anymore.

[RedJohn]

I'm surprised the number isn't higher.

A lot of folks are maxed out well beyond their means...even if they have a larger income....they can't rub 2 nickles together.

They must not be counting the millions that are below 0.

[White Tiger]

This is one of my first posts - So pardon me if Ive wandered into a private discussion - but I thought the site was interesting and I could add something to the conversation.

Here is a chart that shows the value of gold from 1971 to 2004 ($45 per ounce to $700)

http://goldprice.org/images/monthly_dollar.gif

Here is a chart that shows the value of gold over the last 5 years ($800 per ounce to over $1700 per ounce):

http://www.infomine.com/ChartsAndData/GraphEngine.ashx?z=f&gf=110575.USD.oz&dr=5y

This means that as they print/digitize dollars...they make all the dollars in existence worthless because they make more of them. If something is in scarce supply, it is more expensive - but when you have too much of something, it's value is diminished.

Rich guys, who have a lot of wealth, look to preserve that wealth in times of instability. They stop investing so much and start buying and holding actual Gold (and silver). There is only so much Gold above ground, so if really rich guys are buying it up - and there is a limited supply of it - then it is getting more expensive.

To give you an analogy - in the 1800's you could walk into any suit maker in America and have them make you a tailored suit. You could pay for that suit with one $20 gold piece. Today 200(+) years later you can walk into any suit maker in America, have them make you a tailored suit, and you could pay for that suit with that SAME $20 gold piece.

...the difference isn't that things have gotten more expensive...it is that we have diminished the value of the dollar so much - that instead of it costing $20 paper dollars to buy a tailored suit...it now costs $1700 paper dollars!

Don't worry about saving dollars, the value is dropping daily. Store up items you need that you can buy today....because in a week, a month, a year...those things will cost MORE...and the dollars you saved will be worth less than they are today.

And don't buy that thing about interest compounding - there isn't a SINGLE investment you can buy that will generate enough interest to keep pace with the rate of inflation (the difference between the cost of what you bought a year ago versus what it would cost you to buy today).

The value of the thing(s) you bought will be the same - or possibly more - if you bought the right things.

Don't get me wrong, this isn't meant to say "eat drink and be merry for tomorrow we die"...as long as cash exists, you will need some for basic transactions...just don't think your savings are working for you right now. Some banks have begun the phase of economic meltdown where you pay them interest to preserve and protect your deposits...

[ak474u]

This is one of my first posts - So pardon me if Ive wandered into a private discussion - but I thought the site was interesting and I could add something to the conversation.

Here is a chart that shows the value of gold from 1971 to 2004 ($45 per ounce to $700)

http://goldprice.org/images/monthly_dollar.gif

Here is a chart that shows the value of gold over the last 5 years ($800 per ounce to over $1700 per ounce):

http://www.infomine.com/ChartsAndData/GraphEngine.ashx?z=f&gf=110575.USD.oz&dr=5y

This means that as they print/digitize dollars...they make all the dollars in existence worthless because they make more of them. If something is in scarce supply, it is more expensive - but when you have too much of something, it's value is diminished.

Rich guys, who have a lot of wealth, look to preserve that wealth in times of instability. They stop investing so much and start buying and holding actual Gold (and silver). There is only so much Gold above ground, so if really rich guys are buying it up - and there is a limited supply of it - then it is getting more expensive.

To give you an analogy - in the 1800's you could walk into any suit maker in America and have them make you a tailored suit. You could pay for that suit with one $20 gold piece. Today 200(+) years later you can walk into any suit maker in America, have them make you a tailored suit, and you could pay for that suit with that SAME $20 gold piece.

...the difference isn't that things have gotten more expensive...it is that we have diminished the value of the dollar so much - that instead of it costing $20 paper dollars to buy a tailored suit...it now costs $1700 paper dollars!

Don't worry about saving dollars, the value is dropping daily. Store up items you need that you can buy today....because in a week, a month, a year...those things will cost MORE...and the dollars you saved will be worth less than they are today.

And don't buy that thing about interest compounding - there isn't a SINGLE investment you can buy that will generate enough interest to keep pace with the rate of inflation (the difference between the cost of what you bought a year ago versus what it would cost you to buy today).

The value of the thing(s) you bought will be the same - or possibly more - if you bought the right things.

Don't get me wrong, this isn't meant to say "eat drink and be merry for tomorrow we die"...as long as cash exists, you will need some for basic transactions...just don't think your savings are working for you right now. Some banks have begun the phase of economic meltdown where you pay them interest to preserve and protect your deposits...

Good post, I've always used the analogy of the 1964 mustang, in 64' you could buy one with 2500 silver dollars, and today, you can buy one of the loaded ones for about the same. Of course, back then a teenager could work part time and pay for one, today, not so much.

[White Tiger]

Thanks AK47u - that also is a good analogy. I forgot to mention the impact folks feel each time they telegraph the printing of dollars...the cost of all goods jumps to account for the inflation those extra dollars just created.

Therefore any money you have in the bank gets diminished - but the telegraph from the fed to producers is - "get ready to raise your prices by this much"....meaning you, the consumer, can't get ahead of this. It's why you feel like you work harder and harder - but have less to show for it...

...it's because, quite literally...you have less to show for it...unless you buy more (food, water, etc.) of what you need, you will be stressed and stretched to make ends meet.

[Sniper-T]

This is one of my first posts - So pardon me if Ive wandered into a private discussion - but I thought the site was interesting and I could add something to the conversation....

The only 'Private' conversations around here take place via pm's or in closed rooms. Everything else is fair game. Great first(ish) post, and Welcome to the forum.

[White Tiger]

The only 'Private' conversations around here take place via pm's or in closed rooms. Everything else is fair game. Great first(ish) post, and Welcome to the forum.

Thanks Sniper T - just trying to be a good neighbor!

Incidentally - I found this site while doing a Tapatalk search - glad I did, interesting forum!

[realist]

Regarding money in the bank I get roughly .000005 % interest on my savings. So I prefer cash over the general bank account. I agree on having gold and silver as a hedge. I also believe like the rest that having good preps will also be a good inflation hedge.

[ladyhk13]

If you look at a small community bank's checking account a lot of times they will pay you interest if you do a direct deposit and have 10 debit transactions per month. That's what we do. They will do this up to $50,000.00 and then the interest rate drops. We started a couple of years ago making more than 4% but it has dropped (of course when they are lending money for almost nothing) down to I think 1.55% which sucks but it's better than most especially as your balance rises.
Stay away from the large national banks if you want to earn any interest on your money.

[Gunfixr]

We have exactly $5 in our savings account.
Got the 5, now I just need to get the two 0s.

However, there are no credit cards, and no loans other than the house. The vehicles are owned.
We don't get the paper, or tv. There's internet, and Netflix ($8 a month), and the cell phones, no house phone.

All we make pays the bills, puts gas in the vehicles, food in the cupboard, and gets preps when we can, which is most of the time, just in small increments. Lately, I've been selling off stuff, mostly guns and some gear, ammo, that had been collected over the years, to up the preps.
Been feelin' "antsy".

[White Tiger]

We have exactly $5 in our savings account.
Got the 5, now I just need to get the two 0s.

However, there are no credit cards, and no loans other than the house. The vehicles are owned.
We don't get the paper, or tv. There's internet, and Netflix ($8 a month), and the cell phones, no house phone.

All we make pays the bills, puts gas in the vehicles, food in the cupboard, and gets preps when we can, which is most of the time, just in small increments. Lately, I've been selling off stuff, mostly guns and some gear, ammo, that had been collected over the years, to up the preps.
Been feelin' "antsy".

You should get the food you need, so to that end...The idea of trading ammo/weapons for Prepps is a good one...but don't get too carried away...in a real SHTF event, those items will INCREASE in value!

Keep up the good work, no matter the outcome of the election, we're going to face an economic cliff that will take a lot out of our economy just to slow it down. The immediate impact of slowing/stopping all that spending will create a short term condition WORSE than we're experiencing - but it has to be done! The only option is to keep printing until EVERYONE stops buying dollars...which is beginning to happen and would actually be impossible to correct...