If you want to gain peace of mind when it comes to your finances, you’d better have $80,594 in the bank…
That’s the verdict of new research from money management app, Banktivity, which found just over $80k is the amount needed for Americans in order for them to feel financially secure.
The research saw 2,000 people studied and found that savings and assets tallying $80,000 is sadly a distant dream for many with seven in ten feeling far from secure in their finances.
Nearly a third of the Americans polled would completely run out of money in less than a week if they were to lose their main source of income today, according to results.
And the average person would be really struggling in just over four weeks (4.4) according to results.
Such is the state of most people’s finances that 58 percent would struggle to pay off a surprise bill of $500 right away if required to.
The small safety buffer for most Americans might explain why two thirds of respondents (68 percent) don’t feel they have the security of substantial savings to turn to.
And less than a third feel they are financially ‘savvy’ – with saving for retirement, managing a monthly budget and spends on food and dining the hardest areas to maintain control.
A spokesperson for Banktivity said: “The results of the survey show that hardworking Americans are doing the best to enjoy life and make the best out of their financial situation.
We know that it could be a bit of a struggle to plan for the future, especially since life is filled with financial surprises and unexpected turns. However, it’s never too late to make smart financial decisions, cut wasted spends and enhance your financial security long-term.
The struggle to stay afloat financially is an issue that doesn’t go away even on payday. In fact, two-thirds of Americans are living paycheck to paycheck.
But while the majority feel their finances are less than stable, there are improvements that could easily be made.
The average respondent report they typically waste $140 a month on things they don’t necessarily need, but purchase anyway.
This might not sound like a huge amount, but it quickly amounts to $1680 wasted a year – and a jaw-dropping $100,800 when projected across a typical 60-year adult lifetime.
The most unnecessary purchases are eating out at restaurants and ordering takeout, followed by needless groceries, online shopping, and alcohol.
Nearly half (43 percent) spend money on goods and services they tend not to use fully or use at all, while seven in ten (67 percent) say there are a couple of things they can get rid of to save money each month.
Four in ten (39 percent) either have direct debits, subscriptions, or membership monthly fees they’ve been meaning to cancel, but haven’t gotten to it yet.
While making bad financial decisions and a lack of willpower were named as the biggest culprits for the financial setbacks, a number of respondents put the blame on other factors such as medical bills, government policies, and the previous generation ruining the economy.
Only five percent of the survey respondents would describe themselves as very financially savvy. Saving for retirement, creating and sticking to a monthly budget, and spending money on food are the top area’s respondents felt they are not financially wise.
Married couples are the most financially savvy group – giving themselves a higher rating - when compared to those who are dating, single, cohabiting, divorced or widowed.
The results also revealed people who are in cohabiting relationships tend to make poorer financial decisions – nearly half (47 percent) blaming their struggle on their own bad financial decisions.
Parents of 18+ year-olds reporting feeling less financially secure than both parents of 0-17 years old and people with no kids at all.
The Banktivity spokesman added: “Setting a clear budget and getting the right assistance in making smart investment choices will make all the difference - whether you’re preparing for retirement, saving for a vacation, or putting money aside for a rainy day.”
“Through previous research, it was found that people who use the money management app Banktivity, save an average of $500 a year, and 40 hours of time by having every account in one convenient location.”
TOP TEN MAJOR ITEMS & SITUATIONS AMERICANS ARE CURRENTLY SAVING FOR:
Paying off debt
Home repairs
Retirement
Car repairs
Computer/laptop
Medical emergencies
Smart TV
Cell phone/tablet
Overseas trip
Children’s college funds
***This random double-opt-in survey was conducted by OnePoll, a market research company and corporate member of ESOMAR and adheres to the MRS code of conduct. For more information about OnePoll’s research in the media, navigate to their portfolio here: http://www.onepoll.com/in-the-media/. This survey of 2000 US adults was conducted between May 05, 2017, and May 11, 2017, by Market Researchers OnePoll and commissioned by Banktivity.
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