Are People With Debts Better At Saving?
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credit: TheAlieness GiselaGiardino²³
It’s a pretty ironic outcome of a Bankrate survey that people with debts make the best savers. The results showed that 84% of Americans who had debts like car loans, credit cards or student loans (the survey excluded mortgages) are regularly saving a proportion of their income. The people who didn’t have a non-mortgage debt had a regular savings rate of only 63%.
Of course, the lesson shouldn’t be to get into debt so that you can save more money! And besides, the more you look into the details, the more you see that in the overall scheme of things, those without debt are actually saving better. That’s because although more people with debts save regularly, the amount they save is usually less than 20% of their income. Of the people without debt who regularly put aside a portion of their income, a higher proportion of these were saving more than 20% of their income.
But just the same, financial experts do agree that having some kind of debt where you have to make regular repayments can help you develop a better savings habit. If you have repayments you have to meet and therefore need to consider a budget, you can be better off than someone who lives debt free but just spends money without really thinking about it.
Tags: Budgeting | credit | Debt Management | savings
This entry was posted on Friday, April 11th, 2008 at 3:30 am and is filed under Debt Management. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.
