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 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).