While the increase in people who have emergency savings funds is encouraging, it’s still not quite enough for finance experts to rest easy. Those who said they had “some savings,” but not enough to cover three months of expenses, increased from 18% to 20%. Those who had three to five months of expenses covered nudged a bit higher, from 16% to 17%. Advisors say people should have at least six months of expenses socked away in case of an emergency, such as job loss, illness, or other major life events.
People’s savings habits varied by age; perhaps surprisingly, people ages 53-62 were the most likely to have no emergency savings set aside at all. But older folks – those 63 and over – were the least likely to lack savings of any kind. This group was also the most likely to have a full six months of savings in the bank, with 44% of them reporting they had emergency funds to cover six months or more.
Millennials and Generation Xers were equally likely to have no emergency savings, with fully one-quarter of each saying they have no savings at all. Generation X is the most likely to have “some” savings, but less than three months’ worth, and 31% of Millennials have enough to cover three to five months of bills and other expenses.
Income and education also factored in, with those who made more money and were more educated being more likely to have at least six months of savings put away.
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