The economy is ‘booming’… but most Americans can’t cover a $1,000 emergency
Crux note: Lately we’ve been bombarded with rosy headlines about the U.S. economy.
Stocks are ripping… real estate is soaring… unemployment is at a 17-year low.
But behind the euphoria of economic headlines and government stats, something just isn’t quite right in our economy today. Crime is setting records in places like Baltimore and Chicago. Credit-card and household debt are at record highs (even higher than 2008).
Today, we see another example of just how “strong” U.S. consumers are today. According to the report below, only 39% of Americans could afford an unplanned expense of $1,000 today.
Does that sound like a booming economy to you? Does it even sound like a healthy economy?
According to Porter Stansberry, this is no accident. Rather, it’s what he calls “the biggest scam ever perpetrated against the American people.” Learn all about it… and what you can do about it right here.
Life happens: A broken-down car. A leaky roof. A broken bone.
If you were hit with a $1,000 emergency, would you be able to cover it?
For the majority of Americans, the answer is no.
Only 39% of Americans say they would be able to pay for a $1,000 unplanned expense, according to new report from Bankrate.
“Even though unemployment is down and there’s been a recent uptick in wages, we aren’t seeing the needle move savings,” said Greg McBride, chief financial analyst at Bankrate.
Unexpected bills aren’t uncommon. More than one-third of households had a major unplanned expense last year, the survey showed, with half of those costing at least $2,500.
Nearly one in five Americans said they would put the expense on a credit card, the report stated, which usually makes the cost even higher as you pay off the interest.
That’s why experts usually recommend you have an emergency fund.
“Having that emergency savings fund will help you sleep at night before and after that unplanned expense,” said McBride.
He recommended having six months of living expenses to help blunt the financial blow of a surprise bill. While that can seem like an insurmountable goal, every little bit helps.
“In the last recession we had nearly 7 million people who were out of work longer than six months,” noted McBride. “To someone who doesn’t have any or very little extra funds, accumulating six months of expenses sounds like climbing Mount Everest, but that is the destination.”