“There are far too many Americans who
are financially unprepared for an economic
downturn, and lack of sufficient savings
will be most people’s Achilles heel,” said
Bruce McClary, spokesman for the National
Foundation for Credit Counseling, a
nonprofit organization.
Don’t despair though — you can still start saving
and even having a small amount in reserve can
help. Here are a few things you should know to
get things rolling:
GET STARTED
It’s never too late to start setting aside money.
If you are working, automate the savings.
Employers will often allow you to have money
from your paycheck deposited directly into
more than one account. Consider having it sent
directly to a savings account of some sort. If that
is not an option, have your bank automatically
draw it from your checking account on
payday to a savings account. No matter how
you get paid — the key is to make it part of
your routine.
A good rule of thumb is to budget 50% of
your income to essentials like housing and
utilities, 30% toward non-essentials and 20%
toward financial goals like savings and paying
down debt.
MANAGE EXPENSES
At times like this, small automated savings may
not be enough, said Mariel Beasley, co-founder
of the Common Cents Lab at Duke University,
which aims to improve the financial well-being
of low to moderate income Americans.