Mark Dolliver’s Takes

A penny saved is, these days, a penny caught by surprise. With the national savings rate now in negative numbers (which means it ought to be called the national dissavings rate), it’s no secret that Americans are reluctant to salt money away. Yet, the prestige of saving remains high: If thrift were a brand, it would be one with an enviable share of mind. Polling by the Pew Research Center captures the contradictions of Americans’ attitudes and behavior in this area.

One might sense an unearned claim to virtue when 77 percent of adults classify themselves as “the kind of person who always looks for ways to save money.” But that description could include the person who waits for the post-Christmas sales so he can buy a spare yacht more cheaply. A less ambiguous picture emerges when people are asked whether they save and invest as much as they should. Nearly twice as many said they don’t (63 percent) as claimed they do (32 percent). At the same time, though, just 11 percent said they “often” spend more than they can afford, with another 25 percent saying they “sometimes” do so. Thirty-seven percent said they “rarely” do this, and 26 percent said they “never” do.

Apart from simple improvidence, unexpected expenses are the chief enemies to people’s good intentions about saving. Thirty-four percent of respondents answered affirmatively when asked whether they’d had any “unexpected expenses in the past 12 months that seriously set you back financially.” Among those with surprise expenses, medical bills were the biggest culprit (affecting 34 percent), followed by outlays on their cars (24 percent) and homes (20 percent). Even as they bemoan the difficulty of affording life’s necessities, people spend plenty on unnecessities. Asked to cite the thing they “splurge the most on,” a plurality of respondents cited “food and dining out” (25 percent). Also scoring in double digits were “entertainment and recreation” (17 percent) and “shopping and personal items” (15 percent). Automakers will be disappointed to learn that just 3 percent of respondents said they are most prone to splurge on cars.

You might think it would help if people established a formal household budget, as 48 percent do. But one section of the poll indicates otherwise. Among people who set a regular budget, 37 percent said they often or sometimes spend more than they can afford. Among those who don’t set a budget, 35 percent said they often/ sometimes overspend. Nor does budgeting seem to give greater peace of mind: 39 percent of the budgeters said they often worry about money, vs. 31 percent of the non-budgeters.