The US savings rate is 5.7%

[Pizzabrewer]

Experts recommend 10-15%:

www.fool.com/amp/investing/2016/10/03/heres-the-average-americans-savings-rate.aspx

[seanmerron]

Words of Wisdom: Chase your savings rate before interest rates.

[I'm a red panda]

This means that out of every $100 in after-tax income Americans bring in, approximately $5.70 is being saved for things like retirement, emergency expenses, and rainy-day savings.

Why are people saving after tax income for retirement? They really ought to be putting more of that in pre-tax if their savings rate is so low!

[Cwadda]

save more money, put it in the right places, and allocate it wisely. If you do all of those well, your dream of financial freedom could become a reality.

This makes me cringe a little. This is what the financial planners say, then start making high fee portfolios with front load charges for people.

[wenchsenior]

This means that out of every $100 in after-tax income Americans bring in, approximately $5.70 is being saved for things like retirement, emergency expenses, and rainy-day savings.

Why are people saving after tax income for retirement? They really ought to be putting more of that in pre-tax if their savings rate is so low!

I suspect it is a combo of reasons. 1) Ignorance: plenty of people don't understand 401ks and IRAs and the tax implications of each. I've had to explain this to several college educated people I know. 2) Lack of access: A lot of people (I think approx 50% of workers) do not have access to a 401k through work, so aren't prodded by the potential match. Those people could still do IRAs of course, and some do. 3) Uncertain cash flow/lack of emergency fund: lots of people need their savings accounts to do double or triple duty (retirement and emergency fund, etc.) and do not want to 'lock up' savings in a vehicle that would be hard to access without penalty.

[GuitarStv]

That's not bad.

[I'm a red panda]

This means that out of every $100 in after-tax income Americans bring in, approximately $5.70 is being saved for things like retirement, emergency expenses, and rainy-day savings.

Why are people saving after tax income for retirement? They really ought to be putting more of that in pre-tax if their savings rate is so low!

I suspect it is a combo of reasons. 1) Ignorance: plenty of people don't understand 401ks and IRAs and the tax implications of each. I've had to explain this to several college educated people I know. 2) Lack of access: A lot of people (I think approx 50% of workers) do not have access to a 401k through work, so aren't prodded by the potential match. Those people could still do IRAs of course, and some do. 3) Uncertain cash flow/lack of emergency fund: lots of people need their savings accounts to do double or triple duty (retirement and emergency fund, etc.) and do not want to 'lock up' savings in a vehicle that would be hard to access without penalty.

Makes sense. I should check my privilege.

[cheapass]

This means that out of every $100 in after-tax income Americans bring in, approximately $5.70 is being saved for things like retirement, emergency expenses, and rainy-day savings.

Why are people saving after tax income for retirement? They really ought to be putting more of that in pre-tax if their savings rate is so low!

I suspect it is a combo of reasons. 1) Ignorance: plenty of people don't understand 401ks and IRAs and the tax implications of each. I've had to explain this to several college educated people I know. 2) Lack of access: A lot of people (I think approx 50% of workers) do not have access to a 401k through work, so aren't prodded by the potential match. Those people could still do IRAs of course, and some do. 3) Uncertain cash flow/lack of emergency fund: lots of people need their savings accounts to do double or triple duty (retirement and emergency fund, etc.) and do not want to 'lock up' savings in a vehicle that would be hard to access without penalty.

I heard that 401K is just Wall Street stealing your money. Stay away!! Invest in an iPhone and an Audi instead.

[HPstache]

Higher than I expected actually.

[Ryland]

Neat to get that update. Here's a breakdown by age group. Millennial's coming in at -2%.

http://www.fool.com/investing/general/2015/02/02/heres-how-much-the-typical-american-saved-last-yea.aspx

Wonder what the average Mustachian savings rate would be?

[HPstache]

Neat to get that update. Here's a breakdown by age group. Millennial's coming in at -2%.

http://www.fool.com/investing/general/2015/02/02/heres-how-much-the-typical-american-saved-last-yea.aspx

Wonder what the average Mustachian savings rate would be?

Not doing the actual math but it looks to be around 40-50% from this poll here:

http://forum.mrmoneymustache.com/welcome-to-the-forum/what-is-your-savings-rate/

[BlueHouse]

This means that out of every $100 in after-tax income Americans bring in, approximately $5.70 is being saved for things like retirement, emergency expenses, and rainy-day savings.

Why are people saving after tax income for retirement? They really ought to be putting more of that in pre-tax if their savings rate is so low!

I suspect it is a combo of reasons. 1) Ignorance: plenty of people don't understand 401ks and IRAs and the tax implications of each. I've had to explain this to several college educated people I know. 2) Lack of access: A lot of people (I think approx 50% of workers) do not have access to a 401k through work, so aren't prodded by the potential match. Those people could still do IRAs of course, and some do. 3) Uncertain cash flow/lack of emergency fund: lots of people need their savings accounts to do double or triple duty (retirement and emergency fund, etc.) and do not want to 'lock up' savings in a vehicle that would be hard to access without penalty.

Makes sense. I should check my privilege.

While I always understood there were advantages to be had, I never took the time to investigate where or how to get them because my savings was so low, it didn't seem worth my time.  Only when i started to bring in decent money and see some commas in my savings did I worry enough to not want to fuck things up.  That's when I started learning.

[kms]

-2% for <35 year olds? Does that mean that the average under 35 year old person spends 2% more each month than they make? Meaning they're either dipping into their savings or racking up debt?

Or did I not get that right?

[GuitarStv]

-2% for <35 year olds? Does that mean that the average under 35 year old person spends 2% more each month than they make? Meaning they're either dipping into their savings or racking up debt?

Or did I not get that right?

Could also be spending parents money.

[I'm a red panda]

-2% for <35 year olds? Does that mean that the average under 35 year old person spends 2% more each month than they make? Meaning they're either dipping into their savings or racking up debt?

Or did I not get that right?

I don't think they have savings to dip into. They are racking up debt.  Much of it is probably student loan debt.

I wonder how they factor mortgages into these calculations.

[Travis]

A negative overall savings rate for the college or recently graduated-age doesn't surprise me.  An average rate of nearly 6% is astounding.  Wasn't it practically zero just a decade ago?  Or are we looking at different ways of measuring "savings?"

[Schaefer Light]

A negative overall savings rate for the college or recently graduated-age doesn't surprise me.  An average rate of nearly 6% is astounding.  Wasn't it practically zero just a decade ago?  Or are we looking at different ways of measuring "savings?"

I swear I remember hearing that the average US savings rate was negative before the housing crash.  I'm pleasantly surprised that it's as high as it is now.

[Fireball]

A negative overall savings rate for the college or recently graduated-age doesn't surprise me.  An average rate of nearly 6% is astounding.  Wasn't it practically zero just a decade ago?  Or are we looking at different ways of measuring "savings?"

I swear I remember hearing that the average US savings rate was negative before the housing crash.  I'm pleasantly surprised that it's as high as it is now.

Looks like most sites show a low in 2005 of 1.90% so there were certainly parts of the population that would have been negative.  Highest was 17% in 1975.

[spokey doke]

While I always understood there were advantages to be had, I never took the time to investigate where or how to get them because my savings was so low, it didn't seem worth my time.  Only when i started to bring in decent money and see some commas in my savings did I worry enough to not want to fuck things up.  That's when I started learning.

same here

[wenchsenior]

While I always understood there were advantages to be had, I never took the time to investigate where or how to get them because my savings was so low, it didn't seem worth my time.  Only when i started to bring in decent money and see some commas in my savings did I worry enough to not want to fuck things up.  That's when I started learning.

same here

Same.  Also, I think this savings rate is a pleasant surprise for Americans, who are notoriously terrible savers. I wonder how much is due to 'forced' savings because loan restrictions have tightened so much? (Related: will the savings rate then plummet again when the GOP inevitably loosens restrictions back up? Let's check back in four years...)