By Angela Carter, Register Staff

Just ahead of the national fourth annual “America Saves Week,” which starts Sunday, new research shows that most low- and moderate-income families do not have savings accounts.

The Financial Services Roundtable, Consumer Federation of America and Employee Benefit Research Institute analyzed the Federal Reserve’s most recent Survey of Consumer Finances and found that only 32 percent of low-income households (below $18,900) and 48 percent of moderate-income households ($18,900-$33,899) have savings or money market accounts, compared with 80 percent of upper-income households (above $89,300).

During America Saves Week, participating employers, financial institutions, educators and other organizations including media, government and military encourage people to build wealth through saving and reducing debt.

Online tools for the campaign may be found at www.americasavesweek.org.

“Most of the families without savings accounts do not even have adequate funds to cover emergency expenditures, let alone to save for homeownership or retirement,” said Stephen Brobeck, executive director of Consumer Federation of America.

A nationwide survey of more than 1,000 adults commissioned earlier this month by CFA found that 83 percent agreed banks and credit unions should make it a priority “to promote and offer incentives for customers to save automatically,” and supported the elimination of opening and minimum balance requirements if customers transfer at least $25 each month from a checking account.

“Decades ago, the Christmas club account was a mainstay community activity at many banks, where it helped instill a culture of saving for the future that credit cards and easy credit eroded,” said Dallas Salisbury, president of the Employee Benefit Research Institute.

The Financial Services Roundtable earlier this year surveyed the automatic savings products and promotions by 22 of its members, which include most of the nation’s largest banks, and CFA studied the Web sites of the 50 largest banks by number of branches.

Results showed a widespread offering, but weak promotion of automatic savings tied to checking accounts. Some banks offer an incentive — such as higher interest, matched interest, cash bonus or gift cards — to save automatically.

America Saves and the American Savings Education Council Monday will release research on how consumers have changed their practices in response to the recession. Continued...

• 1
• 2
• See Full Story

Contact Angela Carter at 203-789-5752 or acarter@newhavenregister.com.

• 1
• 2
• See Full Story

• 1
• 2
• 3
• See Full Story

• 1
• 2
• 3
• 4
• See Full Story

• Return to Paging Mode