Saving for an emergency is supposed to be the key to establishing a financial safety net. Yet studies continue to show that people aren't putting their money away. The latest evidence comes courtesy of Bankrate.com, which on a monthly basis takes the pulse of how secure people feel about their personal financial situations.
Those of you who save and do it as easily as you breathe might not understand why having an emergency fund is still an issue for so many people. Nonetheless, 26 percent of Americans have no savings cushion, according to Bankrate.com. An overwhelming majority of Americans don't have the recommended six months of living expenses saved.
And who are the worst at saving for that rainy day?
Bankrate.com found people between 30 and 49 are more likely than any other age group to not have an emergency fund.
Here's something that surprised me about the latest savings results. Young adults are more likely to have at least five months of living expenses saved.
Yes, you read that right. The millennials, those aged 18 to 30 who we older folks complain are too entitled, are actually saving. But for good reason, says Greg McBride, Bankrate.com's chief financial analyst.
"They tend to have lower expenses," McBride said. "They don't have to put away as much because they are likely living at home with their parents or have roommates. People 30 to 49 are more likely to not have emergency savings because those are the years they have a house, two or three kids and a dog. But they need the emergency savings more than anybody."
It's not that people don't know they need to save, especially with the Great Recession a close memory.
"There has been an attitude shift," McBride said. "People recognize they don't have enough savings and know they aren't making progress. Savings is a consistent sore spot with consumers when it comes to financial security. But nothing helps you sleep better at night than knowing you have money tucked about in the event of unplanned expenses. Savings provides a critical buffer between you and high-cost debt or other financial distress."
Understandably, one obvious reason people don't have enough money saved is because they are struggling to cover their basic expenses.
But there's another barrier to saving.
"Americans have fallen out of the saving habit," according to a recent report by Oxford Economics sponsored by a group of financial and public-policy organizations.
Even before the recession, the savings rate in America was pitiful. It's better now at almost 4 percent but still not good enough.
"Undersaving at the national level could also place the economy and government on an unsustainable path, marked by an ever-increasing external debt that could ultimately undermine financial stability," the Oxford Economics report said.
Are you alarmed now?
If not, you should be. We've got to become a nation of habitual savers, which is why I was so pleased to see so many young adults catching the savings fever early.
Michelle Singletary welcomes comments and column ideas. Reach her in care of The Washington Post, 1150 15th St. N.W., Washington, D.C. 20071.