When faced with an unexpected $1,000 expense, more than one-third of Americans would borrow the money, according to a new Bankrate survey. That may include tapping their credit cards, seeking money from friends or family or taking out a personal loan.
Most would not turn to cash savings because they don’t have it, the personal finance website found.
Fewer than half of Americans, 44%, say they can afford to pay a $1,000 emergency expense from their savings, according to Bankrate’s survey of more than 1,000 respondents conducted in December.
That is up from 43% in 2023, yet level when compared to 2022.
“We’re just not wired to save,” said Brad Klontz, a certified financial planner and expert in financial psychology and behavioral finance. Our brains are instead programmed to focus on our immediate needs.
“we’re not wired to save” is a weird way of saying
44%56% of Americans barely make it paycheck to paycheck with no disposable income.Edit: wrong percentage
It’s propaganda to make you blame yourself for being essentially indentured.
Yeah something like 25% of Americans make under $35k. That’s poverty wages in this economy.
You kidding? That’s almost a congressman’s wage in my country. I want 35K a year 😭
Doesn’t change the fact that such a wage barely covers rent and food for someone with no dependents
What’s rent cost on a 2 bedroom apartment there?
500 dollars on average
Exactly. Cost of living is way higher than that in the US.
Insanity…
I mean that’s just how it works. I bet there’s cities in your country that cost more to live in than others. Salaries and availability of jobs in those more expensive cities will probably also be higher and the middle of nowhere.
You need to check what the purchasing power parity between US and your country is.
Someone making 35K USD per year in USA is doing roughly as well as someone making 15.3K USD per year in Lithuania. That’s a higher end retail wage here, or 1170 euros.
I make more than that after taxes, and that includes national health insurance and national pension fund.
The caveats are that plane travel, vehicles and electronics will be more expensive to a Lithuanian but fresh food, real estate, rent and services will be more expensive to an American.
56%, the 44% is the part that can pay the $1k
Whoops! Thanks!
This is correct.
It is a spending problem. I know people who make $500k/year who live paycheck to paycheck. I know other people who make $35k/year who have money left at the end of the month (not $1000).
Now i will grant it is a lot easier to live on 500k than 35k, and a lot easier to save. However living paycheck to paycheck doesn’t tell us anything.
“live paycheck to paycheck.”
That may be generally true, but they likely have a bunch of equity in their homes, and I’ll bet their retirement accounts are generous. Sure, there are some who just spend everything, but most people at that level are already “hiding” as much money as they can from taxes.
How many people actually own homes?
The ones making $500k a year own multiples.
What do you mean by own? Own as in 100% paid for - not too many. Own as in their name is on the deed, but most of the value belongs to the bank - more than half of the US.
Lots of people don’t own their homes in any sense it’s my point. They rent.
Their names are on the titles, they own the homes. Their banks - the mortgage lenders - hold a rights to a lien placed on the property, but they have no title to the property unless they enforce the terms of their lending contract in the event of default.
The owners making 500k may very well be just a few months from foreclosure if they lose their job, but they likely have at least 20% (likely much more unless they bought at a premium two years ago) equity and can probably salvage at least half - even after fees - if they were to become “destitute” and undertook a regular sale of the property. 10% of a million dollars (or more), for most of the country, is still a healthy sum of money.
But they own portions of it. It isn’t like it’s 100% the bank’s house until the last payment is made. You build equity that is in fact yours. And in the last decade you could have made a killing if you’d bought a house at the right time. We sold a house last year for almost twice what we paid for it 7 years before. The bank doesn’t get any of that extra money.
If you make 500k and live “paycheck to paycheck”, you have a BIG spending problem or massive debt. When people with low income live paycheck to paycheck, it isn’t because they are spending too much, it’s because they get paid peanuts and necessities are too expensive for that.
Almost all people who live paycheck to paycheck aren’t doing so because they are spending too much, they are doing so because their income and necessary living expenses are too close and they have no disposable income.
Blaming people who struggle when most of them are already frugal out of necessity is the sort of thing billionaires wants you to believe so you’ll not look at the actual problem.
“Not wired to save” … Mother fucker is completely out of touch with systemic pressures squeezing every last ounce out of people.
Friends of ours busted their asses to raise kids and simultaneously go to college for accounting. The other parent rose up to management in a factory.
They still can’t afford a basic house and are endlessly caught in a loop as renters where they get fucked even more.
My wife and I were lucky in the timing of getting our home and lucky to just know a realtor in our family. Luck, luck, luck. I’m not working half as hard as they are if I’m honest and they are getting fucked by a system that doesn’t give a shit about them, all the while the rich get richer then turn around and tell all the plebs to blame the poor immigrants seeking a better life.
You gotta make 100-150k to live comfortably (not luxuriously) in most major cities… Has not much to do with not being “wired to save”, agreed
I got injured overseas and after some years got a pension. I held a job down for a while and bought a house as it fell through. Couple years later I got bumped to a conditional 100% with the va. (a LA your point, alot of luck - most people fight for years to get close to the 70% I got out the gate)
My benefit payment (basically $45k as of this year) is more than people I know in their late 30s with college degree jobs and skilled labor jobs with years under their belts. My mortgage is under $500. (again, luck, got alot of house for the price at the time) Granted, I do live in a pretty “economically depressed” rural city, but my house I paid 75k for ~8 years ago now spitballs for 190k for reference.
But why have children if you can’t or struggle to afford them? Save for longer…then have kids.
Even if they didn’t, it would make little difference.
But (and I don’t know in their case) unplanned kids or not aside, now you’re saying they should wait for this magical time where they might be able to afford owning a home (when in reality they probably did at the time feel they could when prices were lower), versus the fact that you can’t just magically have kids whenever. The older you get, the more risks and complications versus the challenge of simply raising kids when you’re older in general.
The point is there was a time when this sort of calculated planning wasn’t necessary; yet the squeeze from the rich now makes it so we have to literally postpone fucking life because of how rigged the real estate market and the broader wealth gap is.
The point is there are only dilemmas and no good options while societal pressures continue to increase for the poor and middle-class. Besides that, there’s a lot of tolerance and room for forgiveness when you’re rich. Not so much when you’re poor. Make one mistake and you’re fucked. And no, this is not a meritocracy.
According to his job description, the dude is a “Mental Wealth Advisor” 🙄
Gross
affordable housing, healthcare, and education might help. can we get some of that?
If I had affordable housing and education I might be able to afford healthcare. MIGHT be.
Be careful, you may have it good now. For the next generation, they will make them pay a subscription to the police and firefighters service.
Bull shit we’re not wired to save. This fool talks like the rich haven’t been stealing our wealth for the last 50 years and we aren’t left with nothing.
But then they say we waste our money because we have a fucking phone or the internet or avocado toast which last I checked avocados are pretty fucking cheap, as is bread. Like you can function in this world without having a phone or Internet, nowadays. Even homeless people have a fucking phone. Try finding a job without the internet or a phone.
We’ve been robbed our whole lives, and this fuck says that’s your fault.
When I was young I planned to be so smart about retirement.
I’ve yet to make enough money to even cover basic expenses all these years later.
I think it is more like people don’t have high paying jobs with extra money to save.
Lmfao WHAT savings I was almost homeless this year working full time for CVS
Not wired to save? Fuck off! We are collectively underpaid, you disingenuous shitwit!
I sold my car and quit driving altogether and bought a bike and scooter and I save money now.
If I made more money I could have that luxury but take a look around, so many car loans are shit. The cars are shit too. And drivers keep getting worse imo.
Cars are a huge drain on the wallet and an unnecessary expense for many.
Yup. People don’t think about it like that too often. It’s presented as a necessity, but there are no budget options. They’re a never ending expense.
Cars are regularly called money pits.
Owning almost any type of vehicle is going to necessitate maintenance, there’s a classic saying that the two best days in a boat owner’s life are the day they buy the boat and the day they sell the boat.
The rich not only control the media, but vast swaths of our academics as well. Especially so-called economists and “business experts”, like the bootlicker quoted here.
These people know nothing about neurology or psychology. They’re being paid to repeat bullshit so people get complacent (and worse, use their ‘expertise’ to influence lawmaking).
Here’s what happens, at least to me: If I manage to have extra money, I start saving and build up a little nest egg, then need to empty it because of an unexpected expense. And then I start saving again only for that to happen again.
Controversial thought maybe, but I indeed have many friends who should and could afford to save, and choose not to.
None of these friends are wealthy or have high salary’s, they’re just bad with money
Yeah, I’m curious as to what percentage of that group simply can’t afford to save, and the percentage that simply choose to spend instead. Like you, I know people who certainly could be saving money, but instead have new phones all the time and also are driving leased luxury cars.
Saving is slow and boring, it’s easier just to get a credit card and buy something cool. Much more of a rush va seeing a number go up a tiny bit every month.
i would save if i actually had something to save; and i suspect many are in the same boat.
Wow, it’s like encouraging people to live on credit and debt is actually bad for people!
I seriously hate how much the US fucks over people who can’t make enough to even consider saving money; overdraft fees from banks, having to get loans and debt in order to pay for big expenses, punishing people who need to use credit by lowering their credit score… list goes on and on.
as the saying goes, it’s expensive to be poor.
We’re wired to save, if we make enough money to be able to save.
Most people I know do save, put quite a bit of effort in it too.
And then when they’ve saved up some money, one of these unexpected expenses happens that resets them to zero.
And these unexpected expenses keep happening at a shorter interval, causing people that do save to also not have enough buffer to pay for a $1000 unexpected expense AGAIN.
I also know quite a few people that saved a lot over the years, to then see it go up in smoke when COVID hit and life became 50% more expensive in the span of 3 years.
It’s rather revolting how transparent these narcissistic projections have become.
It’s never their (the people defining the rules of the economy, like this expert) fault, it’s always the victims (all of us).
Feck off.
