As the U.S. economy slows, more and more Americans are cutting back on spending to in order to save money, according to a recent nationwide survey conducted by Harris Interactive for the American Institute of Certified Public Accountants.
Twenty-five percent of respondents in the survey of 1,026 adults said they were spending wisely or not spending as much as a means of saving money. This is a sharp increase from 2007, when only 2 percent said they were spending wisely or cutting spending in order to accumulate savings.
"It's both surprising and very encouraging that in the space of a year, so many more people are thinking about their spending habits in the context of saving," said Carl George, chair of the AICPA's National CPA Financial Literacy Commission.
Spending wisely or not spending as much ranks second as a savings strategy in the current survey. Interest-bearing savings accounts take the top spot, with 40 percent of respondents. Other strategies cited were company-sponsored retirement plans (13 percent); stocks, bonds, and mutual funds (11 percent); IRAs (7 percent); and CDs (5 percent). Interestingly, 3 percent said conserving energy was part of their savings plan.
"We'd like to see more people taking advantage of company retirement plans like 401(k)s," George said. "Many employers match a percentage of a worker's contributions. A matching contribution is basically free money."
The study was conducted by telephone within the United States by Harris Interactive on behalf of the American Institute of Certified Public Accountants between March 5 and March 9, 2008, among 1,026 Americans over the age of 18. Results were weighted for education, age by sex, race, household size (number of adults), number of voice/telephone lines in the household, and 8-point region where necessary to align them with their actual proportions in the population.