CFPB Issues Report on Perceived Financial Preparedness, Security, and Saving

A recent report from the Consumer Financial Protection Bureau (CFPB) examines the relationship between saving money and more objective measures of consumers’ financial situations, like difficulty paying bills and past financial shocks. Data from the Bureau’s Making Ends Meet survey—previously released in July—highlights the correlation between how much respondents think they need in savings and how much they actually have in their accounts. 

“Focusing on these and other financial factors, such as income, allows us to better understand how consumers feel about their financial preparedness for emergencies and whether they are prepared to deal with financial emergencies as they arise,” the report reads.

Notably, across survey respondents, 67.9 percent reported saving money while 31.1 percent said that they “don’t save.”

The survey found that consumers who do not save monthly are more likely than those that do to report difficulty paying bills in the last year, a gap found at every income level. Only 17.4 percent of consumers who save routinely had difficulty paying a bill or expense in the past year, while 32.9 percent who save more irregularly had a hard time paying a bill or expense.

Data also showed that negative circumstances cause greater financial strain, especially for consumers who have less than they think they need for emergencies and do not have regular saving habits.  65.6 percent of those consumers report that finances control their lives, while only 28.2 percent of consumers with regular saving habits say that their finances control their lives.

The CFPB’s research brief reinforces its Start Small, Save Up initiative, “which aims to promote the importance of building a basic savings cushion and saving habits among U.S. consumers as a pathway to increased financial well-being and financial security,” according to the Bureau’s data point.