Most Americans have less than $1,000 in savings, true or false ?

[fresh]

http://www.marketwatch.com/story/most-americans-have-less-than-1000-in-savings-2015-10-06

 

Published: Dec 23, 2015 10:01 a.m. ET

 

less than $1,000 in savings, almost no savings ....... true or false ?

 

[swansont]

The article says true.

[fresh]

Don't they feel unsafe with $1000 in savings account ?

Edited January 16, 2017 by fresh

[hypervalent_iodine]

Don't they feel unsafe with $1000 in savings account ?

 

I suspect, though cannot substantiate, that many of the people with $1000 or less are not people with much of a choice in the matter.

[fresh]

I suspect, though cannot substantiate, that many of the people with $1000 or less are not people with much of a choice in the matter.

because the article says Most Americans .......

It sounds like a poor country, but it is a rich country.

 

if that is the case, so do Brits.

 

Edited January 16, 2017 by fresh

[Delta1212]

http://www.thisismoney.co.uk/money/saving/article-2769290/Majority-Brits-1-000-saved-surprise-cash-Isa-rates-record-low-1-17.html

 

But, also:

 

http://www.telegraph.co.uk/finance/11443008/Britons-have-an-average-of-32407-squirrelled-away-but-1-in-4-have-nothing.html

 

 

I suspect in both the above case and in the US one, the "less than 1,000" number is only counting liquid assets in a savings account and not investments, savings bonds or retirement plans like 401(k)s. Which is not to say that everyone has those, but I suspect the amount the average person has saved rises significantly when you aren't solely counting cash on hand.

[CharonY]

because the article says Most Americans .......

It sounds like a poor country, but it is a rich country.

 

if that is the case, so do Brits.

 

 

It is not an indicator of wealth per se, as they may e.g. locked up a large chunk in the mortgage for their home or other physical assets. So part of it can be not saving up money for an emergency fund (which is not a good idea). But of course there are alos a sizeable chunk of people who have low-income jobs and/or live in an area with very high cost of living that may diminish their ability to set aside money specifcially for emergencies.

 

There was a nother study (Schneider Lusardi and Tufano, I think) who basically asked whether people could come up with 2k within 30 days for an unexpected expense and found taht about 25% would be unable to and 19% would need to liquidate asset to do so.

A big issue are also large medical expenses and other situations that reduce available income that would eat up those saving in a flash.

 

Looking at net worth it is also noteworthy that the general trend seems to be that the for the bottom earners, the net worth has been declining. So wealth is there, but has been continued to be distributed upwards since the Reagan years. That also means that it takes longer to build wealth and that especially younger people are vulnerable (see e.g. RSF: Journal of the Social Sciences: Wealth Inequality: Economic and Social Dimensions, 2016)

.

Edited January 16, 2017 by CharonY

[Sensei]

That reminds me TV document about workers in China, on air week or two ago or so.

 

There was showed life of workers from Chinese "nowhere", village thousands km away, in big cities.

 

There was question "how much money do you save?".. Answers were "I am saving 50%", "I am saving 60%", "Oh, she is greedy! She is saving 80%!" (80% from the whole income week/month!)

 

Some of them were living together in the same room the same bed (night shift/day shift = empty bed half of day = can be used by somebody else).

Beds = bunk beds to save room space of course.

 

Other question was "how many days off/vacation you had this year?" Answers were "long consternation" (trying to remind what means vacation perhaps?) "Ah, (Chinese) New Year. 2 days off. Year ago.".

They were saying to work at Sunday 14h, and no other day off. Claiming to be at work for 363 days (in 365 days long year).

 

In one Chinese IT company (in TV document), owner of company (woman) bought bunk beds and put them to company office.

To "save time of her programmers for travel to apartments and back".

Edited January 16, 2017 by Sensei

[John Cuthber]

because the article says Most Americans .......

It sounds like a poor country, but it is a rich country.

 

if that is the case, so do Brits.

 

It doesn't mean it's a poor country; it may mean that a small number of people have most of the money.

And they do

https://www.theguardian.com/commentisfree/2017/jan/16/eight-people-earn-more-billion-economics-broken

[swansont]

http://www.thisismoney.co.uk/money/saving/article-2769290/Majority-Brits-1-000-saved-surprise-cash-Isa-rates-record-low-1-17.html

 

But, also:

 

http://www.telegraph.co.uk/finance/11443008/Britons-have-an-average-of-32407-squirrelled-away-but-1-in-4-have-nothing.html

 

 

I suspect in both the above case and in the US one, the "less than 1,000" number is only counting liquid assets in a savings account and not investments, savings bonds or retirement plans like 401(k)s. Which is not to say that everyone has those, but I suspect the amount the average person has saved rises significantly when you aren't solely counting cash on hand.

 

 

Maybe not.

"one out of every three Americans has absolutely nothing saved for retirement, 56% have less than $10,000 saved, and just 18% have $200,000 or more in retirement savings."

http://www.foxbusiness.com/markets/2017/01/01/12-jaw-dropping-stats-about-retirement.html

 

Not all that surprising. A third of all households make less than ~$35,000 per hear. That doesn't leave a lot for savings and/or investments. One stroke of bad luck can wipe out anything you might have saved, for even higher incomes.

 

Don't they feel unsafe with $1000 in savings account ?

 

I suspect it's a large source of stress.