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.
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.