savings

Americans are feeling better about saving! (But are still bad at it)

Americans are feeling better about how much they're saving, for the first time in six years of Bankrate polling. Cue the confetti!

Oh, wait a second. Forget the confetti -- cue the sad trombone instead. It turns out that consumers aren't really doing a better job with saving.

Excited couple | asiseeit/Getty Images

Bankrate's new survey finds that, for the first time, more Americans feel comfortable with their savings than feel uncomfortable. Yet they don't seem to be saving more. Compared to last year, there's been no improvement in the percentage who say they're not saving anything, and fewer people say they're putting away more than 10 percent of what they earn.

"Let's fix this right now -- change your 401(k) contribution or set up a direct deposit in an amount equal to 10 percent of your paycheck. Now, figure out how to live on what is left," says Greg McBride, a Chartered Financial Analyst and Bankrate.com's chief financial analyst.

One in 6 people says they don't save more money because they "haven't gotten around to it." And 2 in 5 say they don't save more because they "have a lot of expenses."

Those are lousy reasons not to save enough money.

What's the biggest reason you don't save more money?

Feeling less stress over savings

When we asked, "How do you feel about the amount of money you have in savings compared to 12 months ago?" 22 percent of respondents said they feel more comfortable. That's steady with last year.

But the percentage of respondents who said they're uncomfortable with their savings has fallen to 19 percent, from 27 percent last year.

Save now, enjoy later

If you already have a 401(k), 403(b) or 457 retirement savings account at work, Bankrate has a calculator that shows you how increasing your contributions now can improve your retirement income in the future. It's fascinating to see how even a modest bump in savings can increase your retirement security.

This simpler calculator lets you see how contributions to a tax-deferred retirement account can grow over time.

For emergency savings, find the best money market and savings accounts.

Figure out how much to save

In Bankrate's Financial Security Index survey for March, 1 in 5 respondents said they don't save any money, about the same as last year. And one-quarter say they save 5 percent or less of their income.

That's not enough. But how much is enough? There's not one rule of thumb that covers everyone. For one thing, your retirement savings goals change with age. Here are retirement planning guides for:

The percentage of respondents who save more than 10 percent of their income has slipped, from 28 percent last year to 25 percent this year.

One place you can start saving is by taking advantage of high-yield certificates of deposit.

Almost half of people save 5% or less of their income

Spending too much

It seems that middle- and upper-income people have a keeping-up-with-the-Joneses problem. We're talking about households with incomes of $50,000 and higher. Two in 5 of these respondents say the main reason they don't save more money is that they "have a lot of expenses."

"This illustrates what is wrong with Americans and their savings," McBride says. "Too many Americans let their lifestyles dictate what they save or whether they save at all, instead of saving first and living on what is left over."

One of the strongest tools for hitting your goals is to automate your savings and stash it in a high-interest money market or savings account.

Reasons people don't save more money

Another important factor in how Americans save is parenthood. (In this survey, that's defined as being a parent or guardian of a child under age 18.) Almost half (45 percent) of parents say their expenses prevent them from saving more; just 1 in 3 people without kids give that reason.

Financial security hits all-time high

The Bankrate.com Financial Security Index reached a record high of 106.5. For the first time, respondents noted year-over-year improvement in all five things we measure to gauge Americans' financial well-being, including: comfort with their savings, comfort with their debt, net worth, job security and overall financial situation. Both men and women indicate improved feelings of financial security over the past year.

A reading above 100 indicates improved financial security over the past year while a reading below 100 demonstrates a deterioration in financial security.

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