Getting More Americans to Save is a Tall Order

February 20, 2012

Yesterday marked the start of America Saves Week - an annual event that brings together hundreds of organizations to promote personal savings. And if, as the saying goes, timing is everything, than the timing of this event is spot on. Results of a survey released last week by the Consumer Federation of America (CFA) show that fewer Americans have working savings plans than at any time in recent memory

In 2010, 73% of Americans said they spend less than they earn and save the rest; this year, just 66% are squirrelling away money.

"The recession clearly has not ended for millions of American families, especially those with lower incomes," said Stephen Brobeck, Executive Director of the CFA, lead sponsor of Ameria Saves Week.

The survey, conducted earlier this month by Opinion Research Corp., additionally revealed that among those Americans who do save, having a plan with specific goals can have real beneficial effects, even at the low end of the income scale, explained Ken McDonnell of the American Savings Education Council (ASEC). The ASEC, a project of the Employee Benefit Research Institute (EBRI), a Washington think tank.

Over 1,000 organizations - financial services firms, government agencies and consumer groups - are participating in this, the Sixth Annual America Saves Week. Representatives of several organizations were present at a press briefing Friday (February 17).

Several participating groups have developed programs to incent savings. But those programs target Americans with bank accounts.What about the unbanked?

Let's get real folks. If a third of Americans are without savings at least some will end up unbanked if/when they lose their jobs.

"The heightened public fear about job prospects and stability has changed the way people are approaching many aspects of planning and saving," said Dallas Salisbury, head of the EBRI. He said that's good news for saving.

I agree things are changing, but not for the better.  I see ongoing high unemployment as a leading reason why fewer Americans are able to save today. The simple truth is that the unemployed (correctly or incorrectly) don't think they can afford bank accounts.

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