Despite the economic recovery, most Americans continue to face significant financial challenges, according to a national survey assessing household savings for America Saves Week.
One-third of survey participants said they were meeting their savings goals but 63 percent said they were making only fair or no progress in this area.
Stephen Brobeck, executive director of the Consumer Federation of America and a founder of America Saves said that, “Only about one-third of Americans are living within their means and think they are prepared for the long-term financial future. One-third are living within their means but are often not prepared for this long-term future. And one-third are struggling to live within their means.”
The good news is that about 68 percent of respondents said they are spending less than their income and saving the difference, which is an increase from 65 percent in 2013, though lower than the 73 percent reported in 2010.
Sixty-four percent said they have sufficient emergency savings to pay for unexpected expenses like care repairs or a doctor visit and about three-quarters said they are reducing their consumer debt or are consumer debt free.
While unemployment rates have come down, unemployment and underemployment rates are still a problem. Real wages have been stagnant and fewer middle class families are building wealth successfully through home ownership, the report found.
The number of respondents who said they are building equity in their home or other property declined from 68 percent in 2010 to 54 percent this year. And the proportion of homeowners who said they expect to pay off their mortgage debt before they retire fell from 78 percent in 2010 to only 68 percent today.
Individuals with set savings goals slipped from 55 percent in 2010 to 54 percent in 2014. The number of people with a spending plan which allows sufficient saving declined from 46 percent in 2010 to 43 percent in 2013 and 40 percent in 2014.
“Household incomes are not rising rapidly and consumers are having to confront the debt they accumulated during the ‘00s,” Brobeck said during a teleconference on America Saves Week. “One factor due to economics here is that Americans are more realistic about their financial decisions than they were five or six years ago.”
America Saves Week runs through March 1. Almost 1,800 national, state and local organizations are participating in America Saves Week to encourage individuals and families to take financial action.
America Saves is managed by the Consumer Federation of America, the American Savings Education Council and the Employee Benefit Research Institute.