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Senior Correspondent

I’ve heard every excuse.

And, to be honest, I’ve used some of them myself.

I feel it’s time to call ourselves out on what we’re doing to ourselves.

As a country, our savings record is pretty shabby.

Saving Money

We have three kinds of savings that we should be doing: (1) short term: saving enough to have at least six months of living expenses; (2) medium term: saving for a big purchase such as a house, boat, college, etc., and (3) long term: saving for retirement.

In 2012, Bankrate.com said that 28% of Americans had no savings at all. Twenty percent have some, but not enough to cover even three months of living expenses. Forty-three percent had enough to cover three months of expenses. And that’s three months, not the six months many experts recommend.

Saving for big purchases is harder to measure, because we don’t know what accounts are specifically for big purchases, and not part of emergency funds or retirement savings. In any case, savings efforts aren’t exactly stellar: a Pitney Bowes report stated that in 2011 the average savings account balance in the U.S. was $5,923. (Remember, that’s an average, so some may be doing a good job while some are doing nothing, or very little. But the average number is numbingly low. Not many cars or houses are being bought with under $6,000!)

As for saving money for retirement, it can be tucked away in all sorts of accounts, including IRAs, stock trading accounts, even gold bullion. It doesn’t matter what form it’s saved in, as long as it is. Employees have a greater chance of saving if they have access to company retirement plans. Entrepreneurs have to be more self-motivated to save on their own.

And the news is not good. A 2014 Retirement Confidence Study says that 73 percent of those without a retirement plan —whether an IRA, 401(k) or 403(b) — have under $1,000 in investments and savings.

Age-Based Savings Guidelines

So how much should be in those retirement savings accounts? In 2012, Time Magazine reported on some interesting age-based savings guidelines provided by Fidelity Investments. These offer a quick-and-dirty assessment of whether we’re on track, although the calculations should actually be more precise. In any case, they said:

  • At age 35, you should have saved an amount equal to your annual salary.
  • At age 45, you should have saved three times your annual salary.
  • At age 55, you should have saved five times your annual salary.
  • At age 67, about when you retire, you should have eight times your annual salary.

How are we doing? Well, in December 2011, USA Today said that when it came to saving money, half of all retirees had less than $25,000 in savings. (Not exactly eight times their annual salary.)

No More Excuses

Here are the Top Ten Excuses I hear:

  1. “My plan is to save what I have left over, and I never have anything left over.”
  2. “I transfer money from checking to savings, but then have a bad month and need the savings to cover my checking account overdraft.”
  3. “I save whenever I get a big windfall, like my IRS refund check, but I don’t get enough of those.”
  4. “Every time I put something aside, one of my kids comes and tells me she blew the engine in her car and needs it to commute to work, or something like that.”
  5. “Savings accounts don’t pay much interest, so it’s easier to just leave the money in my checking account. And somehow it gets spent …”
  6. “No one can save money in this lousy economy.”
  7. “I’m still young and have plenty of time to save later.”
  8. “I’ve just never been a good saver; no one in my family is.”
  9. “I have too much debt.”
  10. “The prices of food and gas are going up so fast, they eat up everything I think of saving.”

So how are you doing compared to Fidelity’s age-based retirement savings guidelines?

If you’re not doing as well as you’d like, how many of the Top Ten Excuses have you used with yourself? (I admit to having leaned on #1 and #7 for far too much of my early career.)

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