While President Donald Trump has been touting the “economy is raging” under his watchful eye with more jobs, better wages and plentiful 401ks for American workers---many of those added bonuses haven’t transferred to people’s savings accounts just yet.
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According to a new survey, 20% of working Americans say they are unable to save any of their paychecks for retirement, emergencies, or other financial goals. And of those who are saving, only 27% are saving more than 10% of their checks, while just 16% of workers are putting away more than 15% of their income.
“With a steady, significant share of the working population saving nothing or relatively little, it’s virtually guaranteed that they’ll be unable to afford a modest emergency expense or finance retirement. That amounts to a financial fail,” Mark Hamrick, senior economic analyst at Bankrate.com, who conducted the survey said.
The biggest obstacle preventing employees from saving a portion was having too many other expenses at 39%. Other reasons included not having a good job at 16% with another 16% saying they simply “haven’t gotten around to it,” and 13% claimed debt as their biggest deterrent.
But the good news is that three-quarters of Americans are at least saving something, even though for 67% of them it’s less than 10% of their incomes. Surprisingly, the best savers were younger millennials and older boomers at 23% and 27%, respectively. Additionally, more college grads (around 25%) are savings 15% or more of their incomes than those with some college (18%) or high school educated (9%).
Hamrick added that with higher incomes coming in due to Trump’s tax reform, there is no better time to start saving then now.
“There are ready sources to help fund savings and by budgeting for regular expenses and adding a more generous savings component, you’ll be paying yourself first,” Hamrick said.
Bankrate conducted this study over the phone with over 1,000 respondents from February 28-March 4th.