Wednesday, September 21, 2016

Why it’s so hard for most people to save money — even the wealthy

Marketwatch reports:
Despite an improving economy, Americans still have trouble saving — a shocking number of adults have less than $1,000 in a savings account, even when their incomes are more than $150,000.

Although people with different incomes have unique obstacles to saving money, a recent survey of more than 7,000 people from personal-finance website GoBankingRates found that people at all income levels had very little saved in savings accounts.

“Clearly people who are earning a lot are still struggling to get by, which sounds crazy, really,” said Cameron Huddleston, a life and money columnist for GoBankingRates. “If you’re earning that much, why are you struggling?”

Of those whose incomes were less than $25,000, 38% had $0 saved, and 35% had less than $1,000. People who earned more fared better, but still reported low amounts of savings in savings accounts. Of those with incomes of $100,000 to $149,999, 18% had $0 saved in a savings account, and 26% had less than $1,000. And for earners of $150,000 annually or more, those numbers dropped slightly to 6% and 23%, respectively.
Welfare state plus Federal Reserve = lack of savings.