Faced with a sluggish economy and flat-lining wages, consumers will continue to focus on increasing their savings and decreasing debt, just as they have since late 2009, says a new survey by CreditDonkey.com. But this year, they plan to put even more money aside than they have in the most recent past.
Of the 1,100-plus participants in the survey, 46.8 percent expect to save at least $100 per month in 2013; 12.9 percent plan to save at least $500 per month, and 6.8 percent plan to save $1,000 or more. By contrast, only 30.2 percent were able to save $100 per month in 2012, with just 9.6 percent putting away $500 per month, and 5.0 percent saving $1,000.
|On average, how much do you expect to save per month in 2013? © CreditDonkey|
|On average, how much did you save per month in 2012? © CreditDonkey|
Conserving cash is difficult for the majority who responded to the CreditDonkey Credit and Saving Survey. Of those polled, 59.9 percent said they live paycheck to paycheck, and 51.4 percent have less than $1,000 in readily accessible savings.
|Do you live paycheck to paycheck? © CreditDonkey|
|Do you have at least $1000 in readily accessible savings? © CreditDonkey|
It’s unclear how the additional 21.7 percent of people plans to save at least $100 a month in 2013, or if they even have a plan. However, a good plan starts with a determination of how much your current debt is costing you compared with how much your savings are earning. In the long-term, you’ll be able to save more if you pay off some debt first, including credit card balances. Carrying a credit card balance is more expensive than most people realize.
Some other findings of the CreditDonkey Survey include:
About 68 percent of respondents said their savings either remained the same or shrank in 2012. Only 32 percent reported that their savings grew during 2012.
|Did your savings grow or shrink in 2012 (compared to 2011)? © CreditDonkey|
43.5 percent do not have at least $1,000 saved for retirement yet, and 80 percent believe they are not doing enough to save for retirement.
|Do you have at least $1000 saved for retirement? © CreditDonkey|
62.4 percent do not have at least $100 cash on hand.
|Do you have at least $100 cash on hand? © CreditDonkey|
64.8 percent say that if they won $500 in a lottery, they would put the money toward their savings instead of spending it.
|What would you do if you win $500 in the lottery? © CreditDonkey|
It’s great that people are more focused on saving than they used to be, but to ‘walk the walk,’ you need to create a realistic plan to get out of debt. Start by paying down debt with high interest rates and then focus on saving any extra income, especially windfalls and holiday bonuses.
From January 4 to January 8, 2013, CreditDonkey polled 1,109 Americans, age 18 and over, for their views on credit cards, saving, retirement planning and other financial issues with 38 multiple-choice and yes/no questions.