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Taking the following savings quiz will reveal how much you understand about the realities of saving in America.
Q. How much loose change is available for Americans to save?
A. The U.S. Treasury says that Americans hold about $15 billion in loose change.
Q. What is the typical amount of emergency savings that Americans need?
A. According to one recent survey, the typical amount Americans spent last year on unexpected expenditures was $2000. Surprisingly, lower-income households in the survey cited the same amount. Two-thirds of unexpected expenditures were related to medical care or motor vehicles.
Q. How long does it take to completely pay off a $1,000 credit card balance if monthly payments are 2 percent of this balance and there is a 24 percent penalty interest rate?
A. One will never pay off balance. All payments pay off only interest owed.
Q. What is the only free money for savings that is available to many Americans?
A. An employer’s match to a contributory workplace retirement plan such as a 401(k).
Q. If they have no other income, how much must someone who retires at 65 have saved in order to be assured of an annual income of $50,000?
A. For a male at age 65, he should have $620,000 saved to ensure an average income of $50,000 a year for life, for a female at age 65, she should have $665,000.
Q. What percentage of the elderly depend entirely on Social Security payments for income?
A. In 2006, 25 percent of individuals age 65 and older relied 100 percent on Social Security payments for their income.
Q. What represents the most effective way lower-income families have built assets over the past several decades?
A. Through buying a home and paying off the mortgage in full. Over four-fifths of the assets of lower-income homeowners represent home equity.
This is Kentucky Saves Week (Feb. 24 to March 2). To receive more saving info from national experts, enroll at www.kentuckysaves.org or visit americasavesweek.org and click on for individuals.