Laura Rowley Money & Happiness

The majority of Americans are saving -- but not much, according to a new survey.

While three-quarters of Americans report that they save something, half put away only 5 percent or less of their income. Forty-three percent say they aren't saving enough to maintain a desirable living standard in retirement.

Effective and Ineffective Savers

The study was commissioned by the nonprofit organization America Saves, which is currently sponsoring America Saves Week in conjunction with the American Savings Educational Council. A thousand organizations, including federal agencies, the military, large companies, and nonprofit groups, have joined this week's initiative to get spendthrift Americans to prepare for a rainy day. The group's web site offers a cornucopia of resources and tips to encourage savings.

Clearly, there's a correlation between low income and lack of savings. But it's also a matter of poor planning, says Stephen Brobeck, executive director of the Consumer Federation of America, an America Saves participant. Only half of respondents said they had a budget that allowed them to reach their specific financial goals.

"Many people do not have a spending plan, and are not aware of their net assets," Brobeck says. "The people who keep track, who have a spending plan, and who consciously save windfalls, save much more effectively that those who don't."

Altered Physics

It sounds simple enough; just put a plan together. So why don't more people do it?

Here's my theory: Combine easy, ubiquitous credit with a dearth of financial education, throw in an advertising-saturated culture and a national obsession with the lives of the rich and famous (come on, how many of you watched the Oscars?), and you've got a tasty recipe for personal financial dysfunction.

Moreover, structural changes in commerce in recent decades have dramatically altered the way we spend, argues Stuart Vyse, professor of psychology at Connecticut College and author of "Going Broke: Why Americans Can't Hold On to Their Money."

Opportunities to fritter away cash now permeate every aspect of our lives. "It used to be when you were at work or at home, there was little to separate you from your money, except for the occasional door-to-door salesman," says Vyse.

Technological advances in the 1970s, such as the introduction of toll-free 800 numbers for immediate phone sales, were followed by home shopping TV channels and, of course, the Internet. As a result, the variables of availability, time, and effort -- what Vyse calls "the physics of spending" -- have changed enormously in the last three decades.

Aspiring to Extravagance

Making a transaction available requires (obviously) a buyer and a seller with a product or service. "Today, that combination has been made almost ideal and instantaneous," says Vyse. "Any object that can be wrapped in bubble wrap can be obtained by almost anyone." As for services, how many people watched adult movies, played Texas Hold'em, or participated in large-scale auctions at home in the middle of the night 20 years ago?

Additionally, shopping no longer demands physical effort. "Spending once required getting in the car, going somewhere, climbing stairs, lifting," Vyse notes. "Spending responses that are easy to make are going to result in more impulsive decisions -- our wiser selves don't have time to be activated."

The other piece is the advent of flawless marketing precision. As Vyse puts it, "the hard-to-find object is not so hard to find anymore." Couple that with the fact that Americans define themselves by style and aesthetics more than ever, and you get lots of aspirational spending.

The Convenience Compulsion

For instance, before we got married, my husband and I duly registered for Lenox China. We received four place settings, so I continued to add pieces a little at a time over the years. Then Lenox stopped making the Erin pattern. A few years later, I found a company that hunts down discontinued patterns and sells them online.

Then, right before Thanksgiving, when I host my husband's family, I get an email announcing that the company had located my Erin China accessory! Dazzled by a sudden vision of pulling off the perfect holiday affair, the click-and-buy impulse became an unconscious reflex. Through the magic of a matching gravy boat, I was suddenly Martha Stewart.

"Convenience is a beautiful thing," says Vyse, "but in many ways we've lost something, too. All of us are constantly being asked to make these consumer decisions. The email comes and you have to think about it. It used to be when you went home you didn't think about it. There were quiet spaces in the day when we were not consumers."

Granted, our consumer-driven economy offers a daily assault on our self-control. On the other hand, nobody's holding a gun to your head and making you buy a TiVo. (Personally, I think commercials are a fabulous barrier to entry: Why would I spend money on something that would make me waste more time watching television? On my deathbed, will I really regret having never seen "Desperate Housewives"?)

No Stimulus to Save

Vyse says part of the problem is people have less discipline about saving in an era when they need it most. "The economy for most workers has changed drastically," he says. "There is much less economic security and many more part-time jobs without benefits. People are subject to volatility in their income stream. Real wages have actually dropped for people in the last 30 years, especially for people on the lower half of the income curve."

A national savings week is "a weak answer to what is a much bigger problem," Vyse argues. "It's one thing to say consumers are irresponsible when they get in debt and spend too much, but they are the ones the government turns to when the economy goes down. The stimulus package is a perfect example of that -- individual consumers have been asked to sacrifice themselves for our larger economy."

I asked Dallas Salisbury, chairman of the American Savings Educational Council, if he saw any irony in the fact that the government is promoting savings shortly after adopting a tax-rebate stimulus package that encourages Americans to spend.

"I'm not in the business of worrying about stimulus," Salisbury says. "At the personal level, if every single American who got a tax refund chose to save it or pay down debt, that would make me a happy person. I believe that debt reduction and addition to emergency savings for tens of millions of Americans is more important than what this stimulus package could provide to the economy."