As U.S. Household Income Rises, Will You Be Saving?
After years of slow growth, U.S. household income jumped by 5.2% from 2014 to 2015. That’s nearly $2,800 per family, on average. What will Americans do with the extra money?
To be clear, there are “real income” gains – meaning that households have some extra money even factoring in the rising cost of living.
For many, the temptation will be to spend: a nicer car, some new furniture or a few extra dinners out per month.
There’s nothing wrong with living better, (and spending does help the economy), but the best thing about extra money is the potential for added security it gives you.
Saving a dollar today can be worth $6 down the road, when you really need it.
Experts say that we should all be saving at least 5% of our incomes, just for our future retirement funds. When our incomes rise so, too must the dollar amount we save.
It’s also good to keep in mind that inflation, while pretty low now, can rise again. Getting more aggressive with your savings plan today can help you build a hedge against future inflation.
If any of this talk of saving stimulates your “I really should” impulse, go and see your credit union today. The savings professionals at your CU can help you to put a better savings plan in place – and can help you to stick to it.
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