As inflation and economic uncertainty crush American households, only 46% of adults have emergency savings to cover a $400 expense in the third quarter. That is two percentage points lower than survey results from the second quarter, as it appears the financial well-being of consumers is deteriorating.
“The share of U.S. adults who said they would cover a $400 emergency expense with cash or equivalents dropped by 2 percentage points from the previous quarter to 46%, highlighting how cash-strapped many Americans are despite the recent decrease in headline inflation,” according to the survey developed by Bloomberg and conducted by intelligence company Morning Consult.
A majority of the 11,000 adults surveyed said they would either need to depend on debt or be unable to cover an emergency expense:
35% of respondents said they would need to use at least some debt, steady from the previous quarter, while an increasing share, 19%, said they would not be able to pay at all
Morning Consult explained the depressing trend:
“Households are seeing excess savings dwindle with prices still elevated after two years of high inflation, leaving less wiggle room in budgets for unexpected expenses.”
… and so much for ‘Bidenomics‘ sparking what the White House has touted as an economic renaissance. Readers know this propaganda from the Biden administration is malarkey (read: here).
The reality is a $400 emergency expense for the working poor is nearly impossible to pay while borrowing rates are at two-decade highs. Meanwhile, high earners were more than twice as likely as low-income folks to pay the emergency expense with cash or equivalents.
One major problem is that many Americans lack the crucial savings to manage short-term emergencies and build long-term wealth.
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