OLYMPIA – The Washington State Department of Financial Institutions (DFI) and Department of Commerce are proud America Saves Week and Washington Saves Week partners. The national savings awareness program was started by America Saves and the American Savings Education Council in 2007 as way to positively promote strong savings habits and to remind individuals to assess their own savings status – and encourage saving more with the savings pledge.
While the U.S. personal savings rate has been rising from nearly negative numbers during the recession, American personal savings rates only rose to 7.6% by December 2019 (source: US Bureau of Economic Analysis), still short of the desired 10%-20% savings rate many experts recommend. With this in mind, the Saves Week goal to increase personal savings is more important than ever.
“We know it’s tough to set money aside in savings, especially for the many Washington residents still living paycheck to paycheck,” DFI Director Charlie Clark said. “But it’s so important to plan for the future – whether putting a family member through school, having money for emergencies or planning for retirement. Putting aside even $20 every pay day can add up over time and help prepare for the surprises tomorrow may hold.”
Need help thinking of quick savings tips?
- Put that tax return in your savings account for an emergency fund instead of spending it!
- Make saving automatic with a direct deposit from your paycheck – you won’t spend what you don’t see!
- Start teaching your children about the importance of saving – you can start with a family change jar for movie nights or dinners out.
- Pay off those high interest credit cards and put the money you used to put toward payments into the savings account instead!
- Talk as a family about ways to save.
Saves Week 2020 is focusing on specific savings goals each day:
- Monday, Feb. 24, 2020 | Save Automatically
- Tuesday, Feb. 25, 2020 | Save with a Plan
- Wednesday, Feb. 26, 2020 | Save for the Unexpected
- Thursday, Feb. 27, 2020 | Save to Retire
- Friday, Feb. 28, 2020 | Save by Reducing Debt
- Saturday, Feb. 29, 2020 | Save as a Family
This year, DFI is proud to partner with the Washington State Department of Commerce to highlight the Thursday, Feb. 27 focus on saving for retirement.
According to a Jan. 15 USA Today story:
“The typical employee needs to save 16% of income – including an employer match – starting at age 25 to have enough to retire at 67, according to the 2018 Retirement Income Adequacy Study from the insurer Aon.
“If you're not close to saving this much, you're not alone. In fact, the average employee who contributes to a retirement savings account is setting aside around 8% of pay. But savings rates vary quite a bit – from about 4.4% of income to 12.6% – among different demographic groups, the study shows.”
Preparing for retirement can easily be pushed into the “someday” category, as we focus on present needs and expenses. In fact, very few Americans have a plan for retirement savings that is adequate for their desired standard of living after they retire.
Results of the Employee Benefit Research Institute® (EBRI) 2019 Retirement Confidence Survey indicate “Workers who have any retirement plan are dramatically more likely than those who do not have such a plan to report they or their spouse have saved any money for retirement (79 percent vs. 17 percent)...” Sadly, however, the U.S. Bureau of Labor and Statistics data indicates only about 51% of all workers participate in workplace retirement benefit options.
“The Retirement Marketplace removes barriers and allows easy access to retirement savings plans for business owners and workers. When people are better prepared to live comfortably in retirement, it strengthens communities and local economies,” Commerce Director Lisa Brown said. “Employers that offer a retirement savings plan benefit are more competitive in recruiting and retaining the best employees.”
At the Retirement Marketplace, Washington businesses and individuals can easily comparison shop online for retirement savings plans that the state has verified are low-cost so you can save today for your tomorrow. Low cost means no administrative fees to employers, and there’s a cap of no more than 1% in total annual fees to enrollees.
Shop with confidence at your own pace. It’s a free service and completely voluntary. The Retirement Marketplace also provides helpful information and links to great online retirement planning tools.
Start thinking about your retirement by watching these videos:
America Saves: Save for your retirement - https://www.youtube.com/watch?v=7728Dd0u1-E
How the Retirement Marketplace works for individuals - https://vimeo.com/358404420/a9f24f68d0
How the Retirement Marketplace works for businesses - https://vimeo.com/358404433/6e05ccd186
Take the Savers Pledge today to save more this year at https://americasaves.org/for-savers/pledge