Personal Savings Rate Jumps to 15-Year High

Americans are socking away more money as they continue to remain concerned about the economy. The personal savings rate grew 1.4% in May to 6.9%, a 15-year high, according to the U.S. Commerce Department.  Savings as a percentage of disposable income was 5.6% in April. The savings rate was helped by:

• Personal incomes rose 1.4%, helped by one-time checks from the Obama stimulus plan
• Unemployment benefits were increased
• Financial belt-tightening as folks remain cautious about spending money.

Although consumer spending inched up 0.3%, many people continued to focus on cutting back, paying off debt, and saving up for unexpected events such as job cuts. The unemployment rate is expected to increase to 9.6% for June when the government releases its monthly jobs report next week, so many Americans will continue with efforts to be more frugal and put off unnecessary purchases. Nevertheless, the economic data released this week seem to indicate that the Obama stimulus plan is starting to show some results.

If you are working to put away more money, it’s important to find the right savings account to help achieve your financial goals. Search for the best rates on savings accounts, money market accounts, and certificates of deposit here.

1 Comment »

1. [...] money to ride out the recession. The U.S. Commerce Department reported recently that the personal savings rate had risen to 6.9% in May, a 15-year [...]

   Pingback by U.S. Loses More Jobs Than Expected in June | GOtalkmoney Blog — July 2, 2009 @ 2:51 pm

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