A Plan with Specific Goals Helps Savings Efforts

A survey found those with a “savings plan with specific goals” reported more success in savings efforts.

In the past year, there was an increase in the portion of respondents to the annual America Saves Week survey who said they were making good or excellent savings progress—from 35% in 2014 to 40% in 2015. 

More than half of respondents said they were “saving enough for a retirement” with “a desirable standard of living” (55%). Fifty-two percent save at least 10% of their income, and among the non-retired, 49% save at work.

The survey showed that those with a “savings plan with specific goals” save more successfully than those without a plan. Fifty-seven percent of those with a savings plan with specific goals report making good to excellent progress meeting their savings needs, versus 22% without a plan. Ninety percent with a plan say they are spending less than their income and saving the difference (compared to 50% without a plan), 82% indicate they have sufficient emergency savings (compared to 48%), and 65% say they are saving enough for retirement (compared to 31%).

“Making a savings plan focuses one’s attention on how one spends and saves their income,” noted Dallas Salisbury, president and CEO of the Employee Benefit Research Institute, and founding director of the American Savings Education Council. “Those with a savings plan tend to be more careful spending money, less willing to borrow unwisely, and more likely to save conscientiously,” he added.

“Set a goal and make a plan” is the theme of this year’s America Saves Week, Salisbury said during a media conference. “Individuals should decide what they want to achieve, determine the steps they need to take to achieve that goal, and contact a financial institution to find a product that will help them meet their goal, or save at work via payroll deduction,” he added.

Salisbury also said employers can help employees meet their goals by making it easier to enroll in workplace retirement plans, and financial advisers should stress the importance of saving to individuals.

The survey findings were released for the 9th annual America Saves Week, a collaboration of the Consumer Federation of America (CFA), the American Savings Education Council (ASEC), and the Employee Benefit Research Institute (EBRI). A research firm interviewed a representative sample of 1,009 adult Americans from January 29 through February 1, 2015, by landline and cell phone. 

More information about America Saves Week is at http://www.americasaves.org/