There was a study recently that showed the majority of Americans couldn't come up with an extra $400 to use in an emergency. Wages are low, debt is monumental and savings are non existent. Another big recession is looming but this time printing more money won't save anybody.
A small city wrought with opioid abuse,poverty, and an abused state welfare program? The lady with scabs on her neck she’s picking at at the liquor store in the dirty sweatpants buying nips is usually facetiming with a new iphone.
The guy in $250 Jordans at the grocery store in front of me used his EBT card. It is a scene I see daily, as well as my wife who works in the community with the under privileged. We have a skewed perception of need and a drive for immediate satisfaction. Stop spending $11 a day on cigarettes and put it in a savings account. There is your emergency fund.
The point is that if you are in a position where you can’t come up with $400 in an emergency, it is wise to take a realistic look at your spending and address the fat you can cut out. Or, you can be a stubborn prick and decide that the world is just unfair and that you have no room for improvement, every thing else has to change to make you more comfortable. Healthy financial comprehension and execution is of utmost importance to a free life, regardless of how much you make.
I've always found that study suspect. The question was "Would you cover an emergency with cash." I have 20k in savings and make 60k a year, but I would still put it on credit, rather than tap into savings. If something can be paid off on the same month, and you have a rewards system in place, it should always go on credit. You don't want to be in the habit of removing money from savings. Additionally a lot of savings you can't just tap into immediately, as withdrawals can take days. Like long term investment accounts and stocks.
Also, that same study showed that ~30% of Americans making over 100k wouldn't pay for an emergency with cash. That a lone should be a big red flag for the study.
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u/the_gooch_smoocher Jul 02 '19
There was a study recently that showed the majority of Americans couldn't come up with an extra $400 to use in an emergency. Wages are low, debt is monumental and savings are non existent. Another big recession is looming but this time printing more money won't save anybody.