BEA report: Less money being saved

New data from the U.S. Department of Commerce’s Bureau of Economic Analysis (BEA) shows that saving money may have dropped as a priority for Americans.

The amount of money saved fell to $504.8 billion in the month of June, down from $681 billion in May. As a percentage, the amount of income saved in June was at 4.6 percent, compared to 6.2 percent in May.

Consumers without jobs rose to 9.5 percent and with such a high unemployment rate it should not be a surprise that personal savings are down. Another factor is the credit market tightening. People who have the ability to pay their debts are making larger payments so their debt to income ratio stays low and their available credit remain high, which leaves less money in the saving account.

Both personal and disposable income decreased by 1.3 percent in June, with personal income falling by $159.8 billion and disposable income dropping by $143.8 billion. In May, personal income saw an increase of $168.7 billion, or 1.6 percent.

The report from the BEA on income and savings comes after the bureau reported that the nation’s gross domestic product dropped by 1 percent from the first quarter to the second quarter of 2009. During the first quarter of the year, the GDP fell by 6.4 percent.

According to the personal income report, personal consumption expenditures went up by $41.4 billion in June, which was an increase of 0.4 percent from May.