30% Of Americans Can't Afford A $500 Emergency

According to a brand new survey from Bankrate.com, just 37% of Americans have enough savings to pay for a $500 or $1,000 emergency. In the previous year, that number was 56%. That's roughly in line with what I was expecting to see when this study came out back in January. But since then, we've seen an increase in banks reporting some negative outcomes. People who had bank accounts with BBVA, Wells Fargo, Santander, and PNC have seen their balances go up by as much as $500 to even $1,000.

Image by Alexandr Podvalny from Pixabay

To me, it makes total sense that people are struggling to put money away for emergencies. The last time they were able to go that extra mile, people needed them more than ever. So it only makes sense that people would be looking towards this next financial holiday on December 21st to give themselves additional cash to deal with their unforeseen expenses.

But the numbers tell a different story. While many Americans did just fine in 2019, having a rainy day fund is still somewhat rarer than it used to be. Just 37% have at least one $1,000 emergency fund. Last year, there was only about 8% of adults with at least $1,000 in an emergency fund. I guess we can thank COVID for the dip.

While our social safety net may not look like it has been dramatically boosted, my personal finances look better. Since my household income dropped significantly in 2020, I didn't take advantage of the tax cut that got us through the spring economic crisis. My family had no help after our state went into full lockdown. Plus, the rent was about 50% higher than we'd already paid before. Still, my savings remained untouched. At all times in late October, banking and checking accounts are always the most important places to focus. When I started getting serious about paying down debt, that's where my interest in savings came from.

In addition (Mortgage)to just having no other source of income, the pandemic didn't keep me from managing every little penny of my spending even though I couldn't afford it. Yes, people want something for free. Why would people need to spend up to half as much as usual on things? And I think people need more than that — they need things that will keep life going for them. They'll save up to buy a car once they have one, and rent a house for the months I need it. That way, they don't get stuck with either of those things while giving themselves plenty of space to deal with what life throws at them. To a degree, the government wants them to do this. It shows up on forms, bills, and payments. As long as you have your check, your credit score doesn't play an important role here anymore. You're just taking care of yourself. If you're not ready to spend any longer than you are now, just wait until next month. Then, buy a home for less than you'd paid in 2013 and keep waiting. Because let's face it — house prices don't budge until the end of 2021, which is probably as soon as anyone expected.

As we all know, the price of gasoline does come up very often in this survey. That's because a small percentage of citizens need to make sure they have gas for cars. Some folks have to carry around their own gas tanks. Others take public transportation, but still, need to fill them up for groceries. We can't run without gas these days. With a few dollars worth of grocery money gone, the rest of the week is filled with shopping sprees. That leaves people without the ability to plan ahead. Instead of making lists, they just order whatever they need without thinking twice. This also means more trips to stores later, when they might not have enough money to cover everything. Not a fun time.

I should note that I'm fairly happy with the balance of 1,000 because it gives me enough space to use if anything should happen. For example, right now, I'm living alone. No roommates. My dad is there for work. He works night shifts so he can split his hours to get home before dark. That's how we live. Sometimes I'll stay with him overnight for shopping. Other times I get the kids to help. Or my husband is working a lot so he tends to be pretty flexible on what he needs to keep running. But for the most part, I keep myself stocked up and organized with food and supplies. Even though that extra thousand might not seem like a big sum of money, I believe it's necessary to be able to put aside some extra cash to use if someone could take a hit and doesn't need me to pick up his slack.

You know what? Maybe my stress levels are down thanks to being frugal. Maybe I have finally learned to relax because of the money I've saved over the past year. Regardless, I hope you read this and take advantage of this chance to upgrade yourself and the lives of those you love. Now is the perfect time to start doing that. Thanks for reading!

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