24 Percent Of American Consumers Have No Emergency Savings: Poll

CHICAGO — Even after the jolt of the Great Recession, a new study finds that most Americans are not financially prepared for an emergency.

A survey released Monday by financial data publisher Bankrate.com found that only 24 percent of consumers have the recommended cushion of at least six months' expenses set aside. The vast majority aren't ready for contingencies; another 24 percent don't have any emergency savings at all.

With 6.2 million people out of work for half a year or longer, the results underscore just how unprepared many are at a time when both job security and the economy pose concerns.

"The majority of Americans still have much work to do in building an adequate emergency savings cushion," said Greg McBride, senior financial analyst for Bankrate.

The survey results are somewhat surprising, he said, in that the high rates of both joblessness and underemployment dating to the 2007-09 recession have driven home the need for emergency savings. Yet the challenges of the economy and job market also have limited the ability to sock money away for unexpected expenses.

Respondents under age 30 and those with annual incomes under $30,000 were the most likely to report having no emergency savings whatsoever. Those likeliest to have six months' expenses in an emergency fund were higher-income households and people in their 50s and 60s.

Fewer than half of those who participated in the poll had at least three months' expenses in emergency savings -- unchanged from 2007 results.

Discipline is key in building up emergency savings, McBride said.

The takeaway for consumers, he said, should be to start putting more money away with every paycheck. If they build their savings by paying themselves first via automatic deposit, they will gradually move closer to the six-month savings level and also force themselves to spend less.

Among other survey findings:

_ Feelings of financial security, as measured by Bankrate's monthly Financial Security Index, declined slightly to 97.8 in June from 98.5 in May. Any reading under 100 signifies how much less financially secure people are feeling than a year ago.

_ About 26 percent said they were more comfortable with their debt compared with a year ago and 19 percent felt less comfortable, the lowest figure since Bankrate began the monthly polls last December.

Results were based on a telephone survey with 1,006 adults conducted June 2-5 by Princeton Survey Research Associates International. The margin of error was plus or minus 4 percent.

Comments

[demilieu]

02:37 PM on 06/25/2011

The 'emergency' has already been going on for the last 3 years. Savings are long gone.

[femmyror]

06:17 PM on 06/22/2011

"Discipline is key in building up emergency savings, McBride said."

Gee, thanks for the lecture. Maybe we HAD emergency savings, but the recession depleted them.

[MiddleMolly]

01:58 AM on 06/23/2011

I also thought that was an extremely arrogant statement. How many families have been hit by the recession in some way.. either someone in the family laid off, or someone who got their hours knocked back or someone who had a pay decrease somehow. And many people who have gone back to work have had to take jobs at much less than their prior wage.

No wonder people don't have savings built up! And 6 months of pay saved up? In these days, you need two years of pay saved up. 45% of people who are unemployed have been unemployed for more than 6 months.

This man needs to lose his job for awhile to understand how real people are living out here.

[fortressfountain]

01:51 PM on 06/22/2011

I feel the american people are being punished because they are not willing to take out the 60% credit cards and pay day loans to help the global elite.
I think people should save-even if it is small change tucked aside-just stay away from the pesky banks who want to charge you to save.
I do not feel it is our responsibility to support the global elites lavish lifestyles.
Yes we are in a depression-worse than our parents there were not as many taxing bodies and there were no subprime mortgages or credit cards.
Our parents were also not responsible for global debt.

[DCX2]

11:01 AM on 06/22/2011

Maybe it would be easier to save if the interest rates weren't near-zero. As it stands there's no incentive to save at all.

[burberryweekend2011]

05:46 PM on 07/05/2011

You could put money into a retirement account. You should make a profit, at least I am. Even when IRA'S & 401KS took a hit, most people's came back to life, that is, if they didn't take their investment out of the market. In any event, my portfolio saw profits much more than a bank account. I do have a savings with a 4.88 percent interest rate, but that's because my mortgage is with that bank.

I'd suggest starting a retirement account and investing it properly. I don't know why some people's never came back, but I can say I was raised on watching "Wall Street Week in Review." So since I saw that ever since I was a little kid (family watched it every week - all day long I saw something related to investments) and I can say, I can pick them out!

[Mr Hankey]

10:07 AM on 06/22/2011

For those employed, wages are stagnant or lower now while the price of everything is higher; most of us are concerned about losing our jobs, and there are no jobs for the unemployed.

Households that used to be a healthy 2 income are a 1 income, and many people are underemployed.

Who can worry about a rainy-day fund when we can hardly afford to eat and keep the lights and water on anymore? What a no-brainer poll.

[WJG38]

09:30 PM on 06/21/2011

Many American Citizens are willing to work two jobs to make ends meet; but they are not there. I agree that the H1B Visa program needs to go; and illegal workers need to go home. Americans that pay taxes need those jobs and the US Government needs them to pay taxes.

I lost my job 8 months ago; and it is very competative even for $12/hr jobs.

[Cherie Lyon]

01:46 PM on 06/21/2011

Thanks for the support, folks. I had to use my savings when I lost my perm job a couple of years ago. 10 months of unemployment in 2 years hasn't helped my bottom line either and the only jobs I've found were temporary. Add medical bills to that and NOW tell me how I'm supposed to rebuild my rainy day cache? It's been raining for years, doggonit.
I'm tapped, and just learned that the job I had is being eliminated at the end of the month. (Snarl, grumble, gripe...)

[HowietheScreamer]

10:05 AM on 06/22/2011

It's been raining since the 80s when American salaries stopped growing at the same rate of inflation. American middle class has been falling farther and farther behind. It's all part of the Repubican plan to create the 2 class system.

[Cherie Lyon]

12:33 AM on 06/23/2011

Howie, doggonit, stop being so sensible! I want better than that. Think maybe we can talk honest businessmen/women and honest worker to form a partnership based on the idea that the greatest asset a business can have is good workers? And that honest workers can be that great asset and expect to be appreciated? BTW, you nasty intelligent person, F and F.

[Kenz300]

12:00 PM on 06/21/2011

With an unemployment rate of over 9% and an under employment rate of over 20% it is time to reduce both legal and illegal immigration. We need to employ the people that are already here first. The H1B visa program needs to be reduced and employers need to hire qualified American workers that are already here. The H1B visa program has been used to bring in cheaper workers and cut wages for American workers.

[acrossthewalls]

02:57 PM on 06/21/2011

If an American is more qualified, they should get the job. If they aren't, they shouldn't. The idea that being a citizen makes you inherently more deserving of anything, a job included, is the biggest entitlement mentality in this country. The visa program isn't the problem, the education situation is.

[js0860]

04:27 PM on 06/21/2011

I agree with you on the visa issue. We need more LEGAL immigration of people who bring their talents, skills and industry to this country. My four (4) grandparents came to this country in the 1910s and 20s, and were discriminated against because they didn't speak, act or look like people who were already here.

Illegal immigration, however, is just that; illegal. Of course, because I believe that we should either enforce the existing laws or change them, I will be called a racist. Pretty sad when we can't discuss, but we can name call 'til the cows come home.

[Independent66]

11:58 AM on 06/21/2011

Things are going to get worse if we continue down the path we are on! Obama has given us more government spending and things are getting worse. Government spending will not fix this economy and create more jobs, etc. At least the kind of spending that has been done so far. We have seen what that has done, mostly preserved government jobs that are about to be lost this year and next. Green jobs have grown at an enormous cost to the tax payers by about 200k. The last deal added a bit over 700 jobs at a cost of $50k each.

We are faced with a weak economy, no plan to fix it and a regulatory structure that grows every month. Sure there are trillions sitting on corporations books. That money will not be spent here unless this country fixes several things. Tax policy, spending policy, and regulatory policy are the big 3. We need a real plan to do these things. Tax policy means eliminating all special interest deduction for evey person and entity. Rate could fall and still raise more money to fund the Feds. But that needs to be complimented by spending cuts by $2 for ever $1 of increase revenues. Providing a 10 year plan with certainty will allow organizations to plan with some accuracy.

Fixing the regulatory environment will take a lot. Currently there is no check and balance. We need that oversight with teeth to begin sorting this out.

[janylaw]

10:43 AM on 06/21/2011

Why is this a surprise? Wages have stagnated for most if us, we pay more for insurance if you're lucky enough to have a job and/or insurance and productivity is at an all time high - though you wouldn't know it by wages. Most of us are 1 pay check away from disaster. Pollsters - start asking questions that we DON'T already know the answers to, like - should bank execs who got us in this mess receive life in prison or life in food banks

[Eileenla]

05:53 AM on 06/21/2011

It's pretty difficult to have emergency savings if you are under or unemployed. In fact, it's tough to have savings even if you arecemployed, unless you happen to be in the top 10% of folks who own 90% of the nation's assets. Better still if you're in the top 1% who own 40% of the nation's assets...but that's small consolation to the mom who cashiers at Home Depot or the dad who drives a big rig for a "living."

[thudula]

12:22 AM on 06/21/2011

22 MILLION USA CITIZENS CANNOT FIND WORK. REGISTER to VOTE and SPLIT YOUR VOTE. Join (www.numbersusa.org)

[wdw808]

06:59 AM on 06/21/2011

the landlords should be turning the evicted into the board of election as no longer living in the area.........an affidavit should be notarized and mail certified with your list of moved or evicted renters..........as i do

[ddihomes1]

09:25 PM on 06/20/2011

Load up on weapons and food, cause it aint gonna be pretty

[ddihomes1]

09:23 PM on 06/20/2011

WE'RE SCREWED!!

[globalguy]

08:22 PM on 06/20/2011

Surprise! Another newsflash....most Americans spend more than they make (just like our Government)!

[OldTulsan]

01:52 AM on 06/21/2011

One difference: Americans go to jail if they print money.