In the event of an emergency, do you have money beside what's in your checking account set aside to support you financially? If you said no, you're not alone. According to a recent Bankrate survey of more than 1,000 adults, 26 percent of Americans don't have emergency savings.
"Americans continue to show a stunning lack of progress in accumulating sufficient emergency savings," said Greg McBride, chief financial analyst for Bankrate. "Even among the highest-income households - those with annual income of $75,000 or above - fewer than half (46 percent) currently have a six-month savings cushion."
Among those who were saving, 67 percent of respondents had saved less than the recommended six months worth of expenses, while 50 percent didn't have enough to cover more than three months. The problem was most prevalent among those aged 30 to 49, as they were the group most likely to have no emergency savings. Those aged 18 to 30 were the most likely to have saved enough to cover five months.
"Many of those under age 30 have the benefit of lower expenses due to roommates, living with their parents or being students," McBride said. "Ages 30 through 49 are high-spending years when expenses often rise faster than emergency savings can keep up."
It's never too late to start saving
If you haven't begun setting money aside to prepare for emergencies, now is the time to open a savings account. With one of our accounts, you earn interest on your balances so you can watch your money grow. Additionally, you can make up to three withdrawals each month, and you only need $100 to get started - minors younger than 18 can start with as little as $10.
Saving money is a valuable financial habit and not just for emergencies. It can help you get funds together for larger purchases down the road, such as having a down payment for when you're applying for auto loans to buy a car. Citing data from Ally Bank, The Wall Street Cheat reported that setting aside money for the future can also make you feel happier. Even if you're only putting aside a little each month, get started sooner rather than later.
For more information about smart ways to manage your finances, contact Landmark Bank.
Back to Blog