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A lot of us are struggling to save more. There are so many financial goals to meet like buying a house, a new car, paying for a college education and increasing the retirement fund. Although these saving goals are different, all of them can improve your life and give you financial security. The more you can contribute to your savings on a monthly basis, the faster you can reach your financial targets. The money that you have in your savings account will not only help you reach your financial goals. It will also help you survive financial emergencies. In case something happens that will compromise your income or requires you to spend a huge sum of money, your savings can prove to be very useful. Of course, saving is easier said than done. There are so many temptations when it comes to saving. When you see your money growing in your account, the temptation is there to spend it. You have to fight the urge to spend it so you can meet your financial goals. Either that or you have to grow your savings so you can spend some of it. If you want to save more, the logical step to take is to earn more money - right? This is what most people prefer because they do not want to sacrifice their current lifestyles just so they can increase their savings.
Study shows that 1 out of 10 high-earning Americans cannot saveWhile earning more seems like the best course to take when it comes to saving more, it is not always the most effective. At least, this is based on the data provided by PewTrusts.org. This site studied the average American family and their respective emergency funds. In one of the data, they revealed that 1 out of 10 American families earning $100,000 admitted to not having any savings. Imagine that? The average annual spending budget for a family of four is between $40,000 to $50,000. Despite that, this 10% failed to save more. The study also revealed that the lack of savings is causing these families a certain level of stress. They know that one emergency situation can drive their finances down. The data from Pew Charitable Trusts also revealed the following:
- 4 out of 10 American households do not have enough liquid savings to pay for a $2,000 expense.
- 69% of those surveyed will use various resources when they need some cash. 49% said they will use credit to meet an unexpected expense.
- 8 out of 10 households admitted that their savings are not the ideal amount for their size. When asked how much is needed to reach the ideal level of savings, the average household requires $9,000.