Thursday, May 19, 2016

Shrinking U.S. middle class: 47% of Americans don’t have $400 for Emergencies

The title says it all. A recent pool by The Federal Reserve Board shows that 47% of Americans would struggle to come up with $400 to deal with emergencies. The article is well worth reading.
The Secret Shame of Middle-Class Americans
The (misguided) idea is that higher education should come along with massive debt. If we add to that a mortgage and car payments most Americans simply accept the fact of living in debt most of their adult lives. If we throw in unexpected job/career difficulties or serious diseases, this means most Americans struggle with keeping themselves from going bankrupt if not literally dying.
Lesson of the day: Cash is king, even for economic collapses you want a cash cushion. Economic disasters teach us that in nearly all cases cash does not lose value overnight, especially not stable well recognized currencies. You should aim to have at least a month worth of expenses in cash.
If banks close and ATMs run out of money, how much cash do you have at hand?
Fernando “FerFAL” Aguirre is the author of “The Modern Survival Manual: Surviving the Economic Collapse” and “Bugging Out and Relocating: When Staying is not an Option”.


Anonymous said...

Great post. In many emergencies, checks, and credit / debit cards are not accepted. $$$ is rarely a problem. Also a great tool for dropping the price at sale time (I have this much money - take it or leave it.)

Be sure to keep small denominations as well, many will not be willing to provide change for $100. Plenty of $5s and $10s, though it does bulk up the roll.

Cingoldby said...

I'm completely without any sympathy for those feckless American's complaining about not having savings. The problem isn't a lack of money, it's a lack of any restraint. They complain they don't have any money, but they have the wide screen TV and full cable package and the latest IPhone and eat takeaway food.

They are the spoilt generation, living with a sense of entitlement for everything they see advertised on the TV, the idea of making do and mending, the idea of deferring gratification, the idea of saving up for something rather than just borrowing money, those ideas are almost literally unthinkable. Their problems are self inflicted, the only use these foolish people have is as an example to avoid.