You never know when you’re going to have to pay for a major car repair or replace a broken appliance, but new research suggests a lot of people in the U.S. wouldn’t be able to handle an expense like this. According to a new survey from Empower, 32% of Americans don’t have any emergency savings set aside. That’s a big increase from the 21% in the same position last year.
The financial services firm’s annual report on America's economic well-being reveals that 29% couldn’t cover a sudden expense over $400.
- If they were facing an emergency like that, people say they’d rely on a credit card, sell something, borrow money from a friend or relative, or take out some kind of loan.
- Half of Americans admit they’re stressed out over their current level of emergency savings.
- Nearly two-thirds (64%) say building that fund up is a top financial priority and 31% have added to their emergency savings in the last month.
- While 52% regret not starting an emergency fund sooner, 48% are optimistic theirs will grow over the next year.
- For 39%, the biggest hurdle they face in saving for a rainy day is rising prices, followed by high monthly expenses (35%) and low income (32%).
- If they lost their job today, 42% say their current savings wouldn’t help and 18% say their savings would cover less than a month of expenses.
- Another 30% don’t believe they could handle unexpected expenses that could come up in the year ahead.
- Overall, the median emergency savings balance for Americans is $500. Gen X has that much, but Gen Z sits at $400 and millennials have $300, on average, while boomers are doing the best with $2-thousand.
- More than half (58%) say saving is “almost impossible” with rising everyday expenses, but 23% are determined to continue putting money into emergency savings no matter what.
Source: Empower⠀