Living On The Edge: Nearly Half Of U.S. Adults Lack Adequate Savings

A penny saved is a penny earned…but according to that adage, many U.S. adults are not earning all that much.

That’s because almost one-half of all U.S. adults (45 percent) say their household does not have enough money in liquid savings to cover at least three months of living expenses. Moreover, nearly one in ten adults (9 percent) say their household currently keeps no liquid savings, defined as any savings readily available as cash and not intended for long-term investment.

Among those earning less than 35,000, the numbers are more striking. Thirty percent of that group maintains no liquid savings. The new survey was conducted by Harris Interactive and commissioned by LexisNexis Martindale-Hubbell’s lawyers.com, the most comprehensive and trustworthy online resource for finding a lawyer.

“Three to six months’ worth of money saved for living expenses is the minimum every household should have, no matter its income,” said Alan Kopit, legal editor of lawyers.com. “Any less can leave people vulnerable to serious financial woes if they hit unexpected difficulties, like a job loss or medical problem.”

The most common reason adults who save say they do so is to have a “rainy day” fund for unexpected emergencies. Seventy-three percent cited that as their motivation.

Nearly one-in-three adults (29 percent) are saving for a vacation, the survey found. And 15 percent are doing so to fund a special event, such as a wedding or birthday party, although that number rises to 25 percent among females aged 18 to 34.

“There’s no wrong reason to save money, but it’s a good idea to think about the basics initially,” said Kopit. “First create a fund to cover living expenses if you’re left without income for period of time. Once you have that established, you can start putting away money with other things in mind, like a vacation or a new car purchase.”

It’s important to get out debt. Debt paralyses the budgets of families and individuals and makes a dent in their financial future. You can get out of debt right now. All you have to do is a bit of budgeting. Write down all your incomes then total up the incomes. Similarly down your total expenses.

Total the amount of expenses that you have. Then subtract the total of the expenses from the total of the revenues. If it’s positive, then you are able to save the pounds. In case its negative, it means that you are living beyond your income. Which is why you are taking debts to cover your expenses. Debts can also be taken as a measure for tax saving. However we are not talking about that financial aspect. When debt paralyses the financial future of the family, then its time that drastic measures should be taken.

Then look at the debts that you have taken. If you have taken a loan to buy the latest cell phone, the sell the cell phone and buy a cheaper one. Pay of the loan. Don’t buy an expensive model till you can afford to buy one. This should be a thumb rule for almost all the things that you buy. Stop buying on credit and you will get out of debt faster. Repay small loans such as payday loans since they attract a very high interest loans. You pay more in interest than you would for the principal.

Plan for the future. You should have short term, medium term and long-term investment plans. Therefore start saving and investing in the future. This will also get you out of debt. Getting out of debt also increase your credit rating. All individuals have a credit rating. The more positive the credit rating, better are your chances or getting the loans that you really require like the mortgage loan for the house.