NEW YORK, Jan. 2, 2013 /PRNewswire/ -- A recent nationwide survey conducted by TheStreet (NASDAQ: TST) and GfK1 found that one out of five Americans is inclined to make accumulating an emergency fund a savings priority for the coming year. Whether it's Hurricane Sandy's aftermath or fiscal-cliff fears, TheStreet study suggests 2013 may be the year of saving for a rainy day.
When asked what they will be most actively saving for in the coming year, the top response was an emergency fund for unexpected problems (19%). Not surprisingly, this response was most common among Americans with income less than $20,000 (30%) and $30,000 (25%) per year. Saving for home improvements was the second most common savings resolution (17%), followed by children or grandchildren's education (16%).
Joseph Clark, a managing partner at Financial Enhancement Group, suggests the devastation caused by Hurricane Sandy could be making people think about the unexpected. "You don't borrow for an emergency fund," says Clark, "You have to save." TheStreet found that Americans will prioritize saving over spending, even if they receive an unexpected boost in income. If they won $1 million in the lottery, six in ten Americans (61%) say they would save three-quarters or more of the winnings, with 18% saying they would save it all. Only a small fraction (3%) would spend it all.
If a majority of Americans would indeed save three-quarters or more of their lottery winnings, how would they save or invest the money? According to TheStreet study, 56% would choose to play it safe and invest their winnings in a savings account; 44% would contribute to an IRA or retirement savings plan; 41% would invest in real estate; 39% would contribute to a college fund; 37% would invest in stocks or bonds.
Harrison Lazarus, a financial consultant and founder of Harrison Lazarus Advisors explains, "Having endured the worst financial crisis in memory, people are inclined to change their behaviors to offset the odds that they will have to face that hardship again."
TheStreet published an article, What's Your Savings Resolution for 2013, based on results from this study.
1 GfK Custom Research North America, November 2012
About the Survey Results contained in this report are based on a survey conducted by TheStreet and GfK Roper Public Affairs & Corporate Communications. Telephone interviews were conducted from November 30 to December 2, 2012 among a total of 1,006 adult Americans. The margin of error for this study is +/- 3 percentage points for the sample.
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