Even as the job market continues to improve, many financial experts recommend that most Americans keep at least three to six months of expenses stashed away in an emergency savings account. Yet that message — despite years of shaky economic times — still hasn't gotten through.
Over 40 percent of Americans are living paycheck to paycheck, says a new report from Springleaf Financial, a consumer finance company. The findings, released Nov. 13, apply to people across all education and salary levels.
The study discovered that 24 percent of consumers have less than $250 in their bank accounts on any given payday — leaving them without reserves to handle unexpected costs.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
"We know full well that with rising costs and unexpected expenses, consumers may have a tough time making ends meet," Dave Hogan, executive vice president of marketing and analytics at Springleaf, said in a statement.
'Rather go to the dentist'
Among those surveyed who make more than $200,000 per year, 20 percent said they save rarely, inconsistently, or not at all. One in four consumers with a graduate degree actually couldn't miss a single month of paychecks without having to borrow or sell assets.
The study put some of the blame for Americans' failure to save on a lack of financial skills. One in five says they learned about money "the hard way" — and one in five says they would rather go to the dentist than spend half an hour learning money management skills.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
The survey was conducted online among 2,010 consumers in October 2014.
In a separate survey done this year by Ameriprise Financial, just a quarter of people said they were trimming their housing expenses or college savings — the big lifestyle decisions that could result in serious savings. By comparison, more than half said they were cutting down on everyday expenses like eating out, entertainment, and clothing.
Continue reading this article and get limited website access each month.
register for free
Already have an account? Sign in
Subscribe to The Week
Get unlimited website access, exclusive newsletters plus much more.
Subscribe & Save
Cancel or pause at any time.
Already a subscriber to The Week?
Unlimited website access is included with Digital and Print + Digital subscriptions. Create an accountwith the same email registered to your subscription to unlock access.
Not sure which email you used for your subscription? Contact us
