Have Economic Benefits Reached Everyone?
America seems to be at near peak prosperity, as the stock market has boomed (until recently) for the last 10 years and the previous recession occurred over 10 years ago. The unemployment rate is near a historic low. While there are disagreements about which President is responsible for this wonderful news, most Americans are well-off. Right?
Apparently not. The nonprofit Center for Financial Services Innovation polled more than 5,000 Americans and concluded that, in the middle of this unprecedented financial prosperity, only 28% of Americans could be considered “financially healthy”. Their measure of financial health is calculated by analyzing spending, saving, credit and other indicators. It’s described as not having an unhealthy amount of debt, an intermittent income and sporadic savings habits.
The poll found that 17% of Americans are “financially vulnerable,” meaning they struggle with nearly all aspects of their financial lives. Some 44% of respondents reported their expenditures had exceeded their earnings in the last year, plus they needed to utilize credit to make ends meet. Another 42% reported having no retirement savings.
Other research supports these observations. The website bankrate.com includes a report saying that just 29% of Americans have six months or more of emergency savings, and about the same amount say they have no emergency savings. Data from the Federal Reserve and the Federal Deposit Insurance Corp suggests that the median American family has just $11,700 in savings.