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For week ended October 31, 1999 Posted 14 Nov 1999

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Does tithing mean LDS Church members save less? (Many Americans Opt Not to Think Of the Rainy Day)

Summarized by Rosemary Pollock

Does tithing mean LDS Church members save less? (Many Americans Opt Not to Think Of the Rainy Day)
Salt Lake Tribune 29Oct99 N6
By Lesley Mitchell: Salt Lake Tribune

A Consumer Federation of America survey of 1,010 Americans shows low savings rates, especially in Utah, where, according to financial planners, low savings rates can be blamed on tithing. The survey of Americans age l8 and older was taken from July 22-25, shows that a quarter of Americans believe their best chance to retire comfortably is to win the lottery.

Jennifer Danielle and her husband, who are in their 30's and have four children, both work. "We have not put anything away at all," said Jennifer. They agreed they think about retirement. "But between the two of us working, it's all we can do to pay the bills."

The survey showed that many families save little, if anything at all. The study also estimates that half of American households have accumulated less than $1,000 in net financial assets. Assets were determined by subtracting a family's installment debt from their savings and investments. This figure did not include home equity or mortgages. It did however include individual retirement accounts but not 40l (K) savings plans.

David Hatton, Salt Lake City Financial Planner said, "I wouldn't dispute that $1,000 figure for a minute. It's a crying shame." He claims that most people underestimate what a $50 per weeks savings over 40 years would yield at 9 percent. Most guessed it was closer to $200,000 when in actuality it is over $1 million dollars.

"If Americans understood that their chances of winning a big lottery jackpot were l0 to 20 million to one but that they could accumulate hundreds of thousands of dollars through regular saving, more families would put the $50 away rather than spending it on gambling or unneeded consumption," said Joesph Plumeri, chairman of Primerica who co-sponsored the study.

Not surprisingly, one-fifth of respondents with the lowest incomes had the fewest financial assets. The youngest, poorest and the least-educated were also less likely than other demographic groups to save. High consumer debt figured prominently into the picture.

Most people overestimate the wealth of others and underestimate their ability to accumulate wealth. The study suggested Utahns may be even worse off than their peers, sighting large families and high rents and home prices. Financial planners suggested that Utahns who are members of The Church of Jesus Christ of Latter-day Saints and pay 10 percent of their income in tithing may be part of the those who save less.

Copyright 1998, 1999, 2000, 2001 Kent Larsen · Privacy Information