Are You Saving Enough Money?

Incomes are rising, unemployment is going down, new businesses are popping up and things in general are looking quite a bit more hopeful than they did just a few years ago? For some of you, that means you had a great year, and perhaps you used some of that new found money to purchase things you have been putting off for several years. It also means that you were able to pay off some debt, and even save a little money.

This year it might be a good idea to save a little more of that money. Look at your budget, see where you got a little careless with your spending in 2016, and perhaps you can cut out some of those expenses, are at least bring them down, and start saving a little more.

CNN had a great post this week about how much we our saving these days, and how much more we should be:

“Roughly half of Americans are saving 5% or less of their incomes, including 18% that are not saving anything, according to a survey from Bankrate. Only about a quarter of people are saving more than 10% of their earnings. ┬áSo how much should you be saving? Bankrate recommends 15%.

“Between emergency savings and the ever-increasing burden of retirement savings that is on the individual, the goal should be 15% of your income,” said Greg McBride, the personal finance website’s chief financial analyst.

Currently, one in seven people are saving more than 15%, the report showed.

“For a lot of people, it won’t happen overnight. It’s going to take some time, but it’s doable, as the middle class is showing.”

Those in the middle class are proving to be the super savers with 35% of people with an annual income of $50,000-$74,999 saving more than 10% of their earnings.

Of those taking home more than $75,000 a year, 32% were saving more than 10% of their income, according to McBride.

Saving more is easier said than done, which is why McBride suggests making it automatic by having a portion of each paycheck be directly deposited into a savings account and a retirement plan. “Saving needs to happen before you pick up your paycheck.”

Bankrate’s Financial Security Index, which surveyed 1,000 adults in the U.S., also showed consumers are feeling better about their debt and financial situation compared to a year ago, which could actually be bad news for savings accounts.”

If you are a member of a Credit Union, it’s easy to sign up for automatic deductions from your Payroll Checks. Or, if you use online banking, just have an automatic transfer set up to take a small amount our of your regular checking account each month. You can always add more to that on months when your income is a little higher, or expenses are lower, but at least you will have something in savings. We can help you go through your statements and even give you some advice on the best type of investments.

Pete DiSalvo, CPA

Vero Beach Certified Public Accountant

CPA – DiSalvo Logo

 

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