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Members of the shrinking middle class are saving the most for retirement, according to a recent Bankrate survey.
A quarter of middle-class households (those earning between $50,000 and $75,000 annually) set aside more than 15 percent of their income, according to a survey that accompanied Bankrate’s March Financial Security Index. That money is rerouted from their daily expenses to fund long-term goals such as a retirement investment plan or an emergency savings account…
“Middle-class Americans (have) to do the saving, because nobody is going to do it for them,” says Greg McBride, CFA, Bankrate’s chief financial analyst. “They don’t have the six-figure income to fall back on.”
Bankrate recommends saving 15 percent of your annual income, as McBride told CNN News:
“Between emergency savings and the ever-increasing burden of retirement savings that is on the individual, the goal should be 15 percent of your income,” he said.
Money Talks News founder Stacy Johnson recommends saving at least 10 percent of your income. (Check out “The 10 Golden Rules of Retiring Rich” to learn more.)
Bankrate conducted its survey in early March, polling 1,000 adults who live in the continental U.S. When asked what percentage of their annual income they save each year, the responses from people in all income groups were:
- No percentage saved: 16 percent of respondents
- Less than 5 percent saved: 28 percent of respondents
- 6 to 10 percent: 24 percent
- 11 to 15 percent: 10 percent
- More than 15 percent: 14 percent
- Not saving: 2 percent
- Don’t know: 2 percent
- Refused to answer: 3 percent
Other survey findings include:
- People living in urban areas were more than twice as likely invest more than 15 percent than people living in surburban areas.
- Hispanic respondents were more than twice as likely to respond that they don’t save any money as white respondents.
- Thirty percent of women reported feeling less comfortable about the amount of money they had in savings now compared to one year ago, while 23 percent of men answered that way.
- Low-income households (defined as those making less than $30,000 per year) saved the least of any income brackets, with 31 percent saving none of their income.
Do you feel that you’re saving as much as you should be? Let us know in a comment below or on our Facebook page.