This holiday season the average American will spend over $800 on gifts. While a new bike, tablet or hoverboard may be topping the gift list this year, lack of savings is number one on another list – the list of top financial worries in the United States.
Pew Charitable Trust released a report in November as part of a series entitled “The Role of Emergency Savings in Family Financial Security”. Not only did they find that lack of savings is the financial challenge American families worry about the most, they also found that one in three Americans have no savings at all, including 1 in 10 who earn over $100,000 a year.
All across this country, Americans are talking about growing inequality and financial instability. I just returned from participating in three major events focused on these issues: the Aspen Institute’s “Summit on Inequality and Opportunity”, the US Department of Treasury and USAID’s joint convening on “Financial Inclusion”, and the “Closing the Gap” conference, hosted by Florida billionaire philanthropist Jeff Greene.
The speakers included world leaders and big thinkers like Bill Gates, Tony Blair, Thomas Friedman, Robert Reich, and Vice President Joe Biden. The themes were consistent and troubling: wages are stagnating, middle class jobs may be a thing of the past, and wealth inequality has reached unprecedented levels. If that wasn’t bad enough, we are also apparently on the verge of being consumed by robots.
Amidst all of these discussions, America’s savings crisis was also a hot topic. In the light of increasing evidence that income and expense volatility is a driving force of financial instability for American families, two key themes emerged:
- Savings is a core component of financial health. A savings habit – and the stability it brings – is as or more important than income. We cannot address financial instability without providing a way for families to save for the short term and build assets for the future.
- Successful solutions will come from leveraging technology to create products and services that are rapidly responding to consumer needs through the harnessing of real-time data.
My recent travels made one thing clear, EARN’s “First $500” is a solution to help families achieve financial stability. EARN’s Starter Savings Program combines the best technology components from companies like Intuit, Amazon, and ZenDesk with EARN’s deep knowledge of micro savings. An effective and scalable online savings approach, designed from our decade of experience in creating lifelong Savers.
Saving makes a difference in people’s lives. This holiday season join EARN on our #microsavingsmission. With your support we can help working families save their first $500, kickstart a lifelong habit of saving and break this cycle of financial instability. Together we are not just a temporary band-aid, we are part of a lasting solution.
Audrey is the Development Manager at EARN. She is responsible for maintaining and growing EARN’s foundation, corporate, and government funding streams.