Learning From Others – Income and Savings Statistics of Americans

Eyes Wide Open

Your parents and teachers probably told you not to compare yourself to others but I find it VERY helpful to learn from others – especially debt and savings statistics.

As you might expect when you look at averages – almost everyone is up to their eyeballs in debt and has no savings.

The following post has some stats and then some reflections at the end.

Post 1: Personal Profit and Loss Statements of Americans spread out by five tiers

Link: https://graphics.reuters.com/USA-ECONOMY-CONSUMERS/010071CJ2NK/index.html

Take Aways:

• Those with more income do better at driving a profit – in line with my Framework: The Framework: Your Life as a Profit and Loss Statement and Balance Sheet
• The economy has been driven by “the poor” as defined by Reuters recently vs the top tier income. Quite odd! This can’t last much longer!
• There is a BIG jump in savings from the third tier vs the fourth tier
• Everyone is levering up again…. driven by “the poor” as defined by Reuters

Post 2: A Millionaire Collecting Cans

Link: http://www.businessinsider.com/new-york-city-millionaire-collecting-cans-2018-8

Take Aways:

• Habits die hard

• Hard chargers keep charging… $20 bucks to a millionaire is still $20…. it’s not worth less than $20.

Post 3: How America Saves

Link: https://www.msn.com/en-us/money/savingandinvesting/brace-yourself-this-is-how-much-america%E2%80%99s-1percent-has-saved/ar-BBMo9uM?ocid=spartandhp

Take Aways:

• Those that do save and have a savings account have a significantly higher median savings than those that don’t
• The level of savings jump from 60-80% vs. the next tier is significantly higher on a percentage jump from the top 90% to the top 1%.
• Getting into the top 40% of earners is a significant step in the right direction for the overall ability to save

Post 4: A Mental Twist Article – Change is a Waste of Time – Change Your Actions Instead

Link: http://www.businessinsider.com/trying-to-change-yourself-is-a-waste-of-time-theres-an-easier-way-2018-7

Take Aways:

• Change is hard and typically unachievable when you get your identify / emotions involved
• Change your actions not yourself…. get up early vs “I am going to be a morning person”

In Summary

The stats on savings and debt are pretty clear…. to be a successful saver you need to get into the top 40% of income households which is approximately $80K a year in the US. What’s interesting is that is basically the same amount most people equate to being happy: see article here You Need to Make $75K+ to be happy.

What gets people to where they are going in life is definitely different in all of us but if you are wired one way it likely will stay with you…. hence the millionaire collecting cans. If you are pushing forward – you’ll likely get where you want to go but don’t forget that $20 is worth $20 no matter what income bracket you are in.

For those that need to get your trajectory on track – what actions are you taking to move yourself forward. Ignore the “changing yourself” mentality and instead focus on concrete actions.