By Rick Armon
Beacon Journal staff writer
Nearly a third of American adults — roughly 70 million — have no emergency savings to weather a financial crisis, a new NeighborWorks America report says.
The Washington, D.C., nonprofit released its “NeighborWorks Consumer Finance Survey” Tuesday as part of financial literacy month.
It shows that many adults are not, or have stopped, saving — a lesson apparently not learned from the Great Recession, when savings grew and people shed debt.
The survey says 29 percent of adults have no emergency savings.
Among those who do, 42 percent said they could last only three months or less before running out of money.
About 28 percent could last for a year or more.
“We know that it’s still very difficult for people to save,” NeighborWorks spokesman Douglas Robinson said. “They don’t know where to start, how to start.”
Victor Russell, regional operations manager for Apprisen, formerly the Consumer Credit Counseling Service of Northern Ohio, noted that, overall, the jobs gained since the recession don’t pay as well as those lost.
“That’s putting a strain once again on people’s ability to save money,” he said.
His group urges people to have enough money to cover at least three months of living expenses.
Minorities in particular have problems saving, the NeighborWorks survey said.
While 24 percent of white adults reported having no emergency fund, the numbers were much worse for African-Americans (43 percent) and Hispanic adults (39 percent).
The problem even extends to wealthier individuals. Eleven percent of people making $100,000 or more per year said they had no emergency fund.
One of the solutions is learning to budget.
“That’s a hard skill to master, especially when you’re in a crisis reactive mode and you’re trying to put out fires everywhere,” Russell said.
Apprisen offers a free 90-minute session with counselors. For more information, call 800-355-2227 or go to www.apprisen.com.
Americans cited retirement (28 percent) and buying a home (13 percent) as their top savings goals, the survey said.
Rick Armon can be reached at 330-996-3569 or firstname.lastname@example.org.