Survey Says: 40% of Americans Have Less Than $300 in Savings
Ok, so this is crazy! After all the FED stipend, checks-in-the-mail programs, the unemployment addons, on both a State and Federal level, rent and eviction moratoriums… U.S.households still don’t have two nickels to rub together!
SCARY! What’s the US economy look like? What will be the impact on small-dollar lenders? Sure, demand for payday loans, car title loans, installment loans, line-of-credit loans, Buy-Now-Pay-Later plans… will skyrocket. So will “first-time-payment-defaults [FPD].
Those of us who are “Lenders to the Masses” best keep our heads up!
According to a recent GOBankingRates survey, 40 percent of Americans have less than $300 in savings, reflecting the effects of the COVID-19 pandemic on Americans’ financial health. This data is significantly less than the $400 figure that the Federal Reserve uses to measure households’ financial well-being. In the most recent Federal Reserve Report on the Economic Well-Being of U.S. Households, released in May 2021 and covering 2020, only 64 percent of Americans could cover a $400 emergency expense completely using cash or its equivalent. This means that 36 percent would need access to credit to meet unforeseen needs.
“We find that people’s financial savings can serve as a kind of litmus test for their financial well-being in general,” said Andrew Murray, content data researcher at GOBankingRates. “The 50-30-20 budgeting rule suggests people save 20 percent of their income, so when people don’t have any savings or have to withdraw from it unexpectedly, it’s a good indicator that they are struggling financially.”
Read the full article here: Survey
