44% of Americans can't pay an unexpected $1,000 expense from savings. ‘We're just not wired to save,’ expert says

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.

ares35,
ares35 avatar

i would save if i actually had something to save; and i suspect many are in the same boat.

Poggervania,
Poggervania avatar

Wow, it’s like encouraging people to live on credit and debt is actually bad for people!

I seriously hate how much the US fucks over people who can’t make enough to even consider saving money; overdraft fees from banks, having to get loans and debt in order to pay for big expenses, punishing people who need to use credit by lowering their credit score… list goes on and on.

ares35,
ares35 avatar

as the saying goes, it's expensive to be poor.

Binthinkin,

I sold my car and quit driving altogether and bought a bike and scooter and I save money now.

If I made more money I could have that luxury but take a look around, so many car loans are shit. The cars are shit too. And drivers keep getting worse imo.

Cars are a huge drain on the wallet and an unnecessary expense for many.

the_q,

Yup. People don’t think about it like that too often. It’s presented as a necessity, but there are no budget options. They’re a never ending expense.

kick_out_the_jams,

Cars are regularly called money pits.

Owning almost any type of vehicle is going to necessitate maintenance, there's a classic saying that the two best days in a boat owner's life are the day they buy the boat and the day they sell the boat.

SnotFlickerman,
@SnotFlickerman@lemmy.blahaj.zone avatar

Good for you!

Of course, because of the car-centric nature of the US, you have to already live in area that a bike or scooter can get you around in. That discounts a lot of the rural US.

arquebus_x,

“We’re just not wired to save,” said Brad Klontz

Asshole. Like THAT's the problem.

osarusan,
osarusan avatar

Yeah that jumped out at me too. What a privileged bunch of crap to spew.

Our brains are instead programmed to focus on our immediate needs.

Yes, we are "programmed" to buy things that we need to live, like food, shelter, and medicine. I'm pretty sure most people would save if they fucking could. You'd think that "a certified financial planner and expert in financial psychology and behavioral finance" could come up with something a bit better than another avocado-toast-like victim blaming.

myrdinn,

affordable housing, healthcare, and education might help. can we get some of that?

Deello,

If I had affordable housing and education I might be able to afford healthcare. MIGHT be.

hawgietonight, (edited )

Be careful, you may have it good now. For the next generation, they will make them pay a subscription to the police and firefighters service.

Endorkend,
Endorkend avatar

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).

FartsWithAnAccent,
@FartsWithAnAccent@lemmy.world avatar

Not wired to save? Fuck off! We are collectively underpaid, you disingenuous shitwit!

034521231,

Let me point you in the right direction, its the government that has screwed up the monetary system, its their fault things are not affordable.

BakerBagel,

The factory i work at has had three 45¢ raises since 2008. Sure the $20/hour was great during the recession, but it’s hardly enough to live on today, and that’s over double my state’s minimum wage.

FartsWithAnAccent,
@FartsWithAnAccent@lemmy.world avatar

I remember reading a study from about 10-20 years ago that found the average income for Americans to actually get by with enough to make it to retirement and have adequate healthcare was $75,000 a year. It’s probably much higher now too: The increasing levels of disparity are just fucking disgusting.

Semi-Hemi-Demigod,
Semi-Hemi-Demigod avatar

Here's what happens, at least to me: If I manage to have extra money, I start saving and build up a little nest egg, then need to empty it because of an unexpected expense. And then I start saving again only for that to happen again.

cabron_offsets,

Feck off.

Chainweasel, (edited )

“we’re not wired to save” is a weird way of saying 44% 56% of Americans barely make it paycheck to paycheck with no disposable income.

Edit: wrong percentage

Hairyblue,
Hairyblue avatar

This is correct.

bluGill,
bluGill avatar

It is a spending problem. I know people who make $500k/year who live paycheck to paycheck. I know other people who make $35k/year who have money left at the end of the month (not $1000).

Now i will grant it is a lot easier to live on 500k than 35k, and a lot easier to save. However living paycheck to paycheck doesn't tell us anything.

SnotFlickerman,
@SnotFlickerman@lemmy.blahaj.zone avatar

You’re fucking saying this nonsense on an article about how 44% of the country can’t come up with $1000 in an emergency.

By definition, if the people making $500k/year have been saving, that means they have money to pay off that emergency, even if comes from a fund they didn’t intend it to.

So nearly half the country isn’t in that bag. Can we stop with this “pAyChEcK tO pAyChEcK tElLs uS nOtHiNg” bullshit. There’s plenty of other data to show that more than half the country is fucking hurting. US average salary is right around $60k. That’s because there’s a shitload of people making $30k and a small sliver of people making $900k.

For example, to get an average of roughly $60k between a group of people making $30k and people making $900k, you need thirty people making $30k to one person making $900k. That’s our fucking economy, dude.

bluGill,
bluGill avatar

44%. That is far too many to be believable or explainable as a poverty problem. Well before you that many people there are plenty of people who on a similar income can find $1000. Getting a credit card with more than $1000 limit is easy if you have income - unless you already have so many maxed out, or otherwise have not made payments. Maybe not for everyone, but they are claiming > 40% of Americans here which means many of them have a good enough jobs and means to pay off a $1000 loan - so if they can't get that it means they are way over extended.

The people I know making $500k/year have debt payments so high they can't come up with $1000, and if they could get more debt they would have done so already.

SnotFlickerman,
@SnotFlickerman@lemmy.blahaj.zone avatar

The only thing I’m taking from this is that your friends (and by extension, rich people in general) are bad at managing their money, and they project that on to the poor.

bluGill,
bluGill avatar

The important point here is you cannot project this statistic on the poor! Maybe poor have problems, but there is no way 40% of the US is that poor. The majority of that 44% has a spending problem. If you want to make a statement about the poor you need to study the poor and that means you won't study everyone and talk about 40+%.

SnotFlickerman,
@SnotFlickerman@lemmy.blahaj.zone avatar

Dude go jump in a wood chipper, please.

I’m poor and I have cancer meds that cost $16k a month. You literally don’t know what the fuck you’re talking about. I can’t spend money on anything extra if I fucking wanted to.

So you’re better off being used as kindling. Because you’ve got no evidence your position is true other than your feelings.

Man, fuck your feelings, put them in a wood chipper, too. Come with some data or fuck off into a wood chipper.

pinkdrunkenelephants,

My guy, you can’t just dismiss the stat because it’s so high. The fact that it’s so high shouldn’t trigger skepticism, it should trigger alarm.

bluGill,
bluGill avatar

I'm not dismissing it. However I am dismissing the idea that this has anything to do with poverty. That later is what most people commenting seem to be assuming and that is not supported by the data we have.

pinkdrunkenelephants,

Why would you think any of the data either side has is valid post-covid?

Nudding,

Nobody here gives a fuck about the people you know.

NovaPrime,
@NovaPrime@lemmy.ml avatar

You’re right, it is unbelievable. Unbelievable that the wealthiest nation in the world, which built that wealth off the backs of those people (ignoring for the moment the colonialism, slavery, and other forms of economic abuse over its brief 250 years of existence), allows them to exist on the fringes of society where a $1000 emergency can be life or death. Unbelievable that there are tools like yourself who still insist this is an individual problem rather than a societal one. Unbelievable that we continue to do nothing about it but turn a blind eye and vilify them as they sink further and further into instability and poverty, and then turn around and wonder why half of society has given up on the very idea of society. And unbelievable that you can say the shit you say with a straight face without someone smacking the taste out of your mouth.

pinkdrunkenelephants,

c/murderedbywords

SnotFlickerman,
@SnotFlickerman@lemmy.blahaj.zone avatar

And unbelievable that you can say the shit you say with a straight face without someone smacking the taste out of your mouth.

*chefs kiss

Chainweasel,

God Damn! 👏👏👏

Overzeetop,
Overzeetop avatar

"live paycheck to paycheck."

That may be generally true, but they likely have a bunch of equity in their homes, and I'll bet their retirement accounts are generous. Sure, there are some who just spend everything, but most people at that level are already "hiding" as much money as they can from taxes.

lolcatnip,

How many people actually own homes?

RGB3x3,

The ones making $500k a year own multiples.

bluGill,
bluGill avatar

What do you mean by own? Own as in 100% paid for - not too many. Own as in their name is on the deed, but most of the value belongs to the bank - more than half of the US.

lolcatnip,

Lots of people don’t own their homes in any sense it’s my point. They rent.

Overzeetop,
Overzeetop avatar

Their names are on the titles, they own the homes. Their banks - the mortgage lenders - hold a rights to a lien placed on the property, but they have no title to the property unless they enforce the terms of their lending contract in the event of default.

The owners making 500k may very well be just a few months from foreclosure if they lose their job, but they likely have at least 20% (likely much more unless they bought at a premium two years ago) equity and can probably salvage at least half - even after fees - if they were to become "destitute" and undertook a regular sale of the property. 10% of a million dollars (or more), for most of the country, is still a healthy sum of money.

meco03211,

But they own portions of it. It isn’t like it’s 100% the bank’s house until the last payment is made. You build equity that is in fact yours. And in the last decade you could have made a killing if you’d bought a house at the right time. We sold a house last year for almost twice what we paid for it 7 years before. The bank doesn’t get any of that extra money.

MrFunnyMoustache,

If you make 500k and live “paycheck to paycheck”, you have a BIG spending problem or massive debt. When people with low income live paycheck to paycheck, it isn’t because they are spending too much, it’s because they get paid peanuts and necessities are too expensive for that.

Almost all people who live paycheck to paycheck aren’t doing so because they are spending too much, they are doing so because their income and necessary living expenses are too close and they have no disposable income.

Blaming people who struggle when most of them are already frugal out of necessity is the sort of thing billionaires wants you to believe so you’ll not look at the actual problem.

nicetriangle,
nicetriangle avatar

Yeah something like 25% of Americans make under $35k. That's poverty wages in this economy.

Harbinger01173430,

You kidding? That’s almost a congressman’s wage in my country. I want 35K a year 😭

nicetriangle,
nicetriangle avatar

What's rent cost on a 2 bedroom apartment there?

Harbinger01173430,

500 dollars on average

nicetriangle,
nicetriangle avatar

Exactly. Cost of living is way higher than that in the US.

Harbinger01173430,

Insanity…

nicetriangle,
nicetriangle avatar

I mean that's just how it works. I bet there's cities in your country that cost more to live in than others. Salaries and availability of jobs in those more expensive cities will probably also be higher and the middle of nowhere.

aBundleOfFerrets,

Doesn’t change the fact that such a wage barely covers rent and food for someone with no dependents

BakerBagel,

Cool, I’m not in your country. I pay $10,000 a year to live in a one bedroom apartment in Nowhere, Ohio. That doesn’t include my utilities, my student loans, my car payments, or my health insurance.

paddirn,

Holy shit, do they have any openings there? <$900/month sounds pretty good.

optissima,

Yes but there are no jobs there that support it and no infrastructure to do remote, gl.

Justas,
@Justas@sh.itjust.works avatar

You need to check what the purchasing power parity between US and your country is.

Someone making 35K USD per year in USA is doing roughly as well as someone making 15.3K USD per year in Lithuania. That’s a higher end retail wage here, or 1170 euros.

I make more than that after taxes, and that includes national health insurance and national pension fund.

The caveats are that plane travel, vehicles and electronics will be more expensive to a Lithuanian but fresh food, real estate, rent and services will be more expensive to an American.

Bipta,

It's propaganda to make you blame yourself for being essentially indentured.

Zorque,

56%, the 44% is the part that can pay the $1k

Chainweasel,

Whoops! Thanks!

newthrowaway20,

Bull shit we’re not wired to save. This fool talks like the rich haven’t been stealing our wealth for the last 50 years and we aren’t left with nothing.

But then they say we waste our money because we have a fucking phone or the internet or avocado toast which last I checked avocados are pretty fucking cheap, as is bread. Like you can function in this world without having a phone or Internet, nowadays. Even homeless people have a fucking phone. Try finding a job without the internet or a phone.

We’ve been robbed our whole lives, and this fuck says that’s your fault.

Bipta,

When I was young I planned to be so smart about retirement.

I've yet to make enough money to even cover basic expenses all these years later.

Hairyblue,
Hairyblue avatar

I think it is more like people don't have high paying jobs with extra money to save.

SnotFlickerman,
@SnotFlickerman@lemmy.blahaj.zone avatar

The media has been blaming poor people for not having money for forty fucking years or more.

girlfreddy,
@girlfreddy@lemmy.ca avatar

Tbf it’s rich people who’ve been saying that, with media parroting them … but I get what you mean.

SnotFlickerman,
@SnotFlickerman@lemmy.blahaj.zone avatar

with media parroting them

You mean the media that those rich people own? Huh, I wonder why the employees can’t go against the boss’ narrative without getting fired?

This is literally part of why Musk bought Twitter.

aniki,

Those are the same people.

girlfreddy,
@girlfreddy@lemmy.ca avatar

You’re right. I’ll amend my comment.

… with the media, that they own, parroting them.

Hairyblue,
Hairyblue avatar

"Over the last 40 years, sadly, I think there’s been an effort to either make folks mad at folks at the top, or to be mad at folks at the bottom, Obama said. "And I think the effort to suggest that the poor are sponges, leeches, don’t want to work, are lazy, are undeserving, got traction."

To illustrate his point, the president brought up Fox News.

"If you watch Fox News on a regular basis, it is a constant menu," Obama said. "They will find folks who make me mad. I don’t know where they find them. They’re like, ‘I don’t want to work. I just want a free Obama phone’ or whatever. And that becomes an entire narrative, right? That gets worked up. And very rarely do you hear an interview of a waitress, which is much more typical, who’s raising a couple of kids and is doing everything right but still can’t pay the bills."

Yep, and this is from when he was president. Fox News is propaganda.

SnotFlickerman,
@SnotFlickerman@lemmy.blahaj.zone avatar

Excellent pull-quote except for this part: “I think there’s been an effort to either make folks mad at folks at the top”

No, Obama. No. We don’t have power to do that. FOX News isn’t trying to make folks mad at people at the top. They’re only trying to do that to you, Obama, because you’re black. They’re propping up every rich fucking piece of shit they can, otherwise!

Hairyblue,
Hairyblue avatar

I believe he was saying other news networks were trying to make people mad at the top. But Fox News is casting poor people as bad and lazy when they are not.

SnotFlickerman, (edited )
@SnotFlickerman@lemmy.blahaj.zone avatar

other news networks were trying to make people mad at the top

Yeah, none of them actually do that. People are angry at the top because we constantly see them getting away with shit in the media. Like Trump, for example. I’m fucking pissed at him and the entire Republican establishment, because they’re criminal fascists who tried to do a fucking coup, and I’m pissed at the Democrats for fucking glad-handing and footsying around with fucking fascists instead of treating it like the serious fucking problem it is. I’m pissed at AG Garland waiting until it was clear that Trump wasn’t going to give back classified documents after two years to finally file charges. Anyone else would have been in chains almost immediately, and we I’m pissed at Obama for not putting an AG that would go after Bushes war crimes. No, we have a lot of glad-handing and letting people off at the top and that’s where that sentiment fucking comes from Obama you “we need to look forward not backward” piece of shit. His lack of will in prosecuting war crimes is part and parcel to why they’re so hesitant to prosecute Trump. It’s all a fucking joke.

That is why people are angry at the top, not because any fucking media told us to. FUCK! Because it’s painfully obvious there’s two justice systems, one for the rich and politically connected and one for everyone else!

queermunist,
@queermunist@lemmy.ml avatar

If people are hungry then let them eat cake!

Been going on for a lot longer than fourty years.

MarieFerrante,
MarieFerrante avatar

It's unfortunate but not surprising that many Americans struggle to cover unexpected expenses. However, relying on borrowing money, whether it's through credit cards, loans, or seeking help from friends and family, can sometimes compound financial stress in the long run. It highlights the importance of building up emergency savings, even if it's challenging. Starting with smaller goals, like setting to borrow 200 today, can make a big difference over time in creating a safety net for future emergencies.

quams69,

Lmfao WHAT savings I was almost homeless this year working full time for CVS

NENathaniel,
@NENathaniel@lemmy.ca avatar

Controversial thought maybe, but I indeed have many friends who should and could afford to save, and choose not to.

None of these friends are wealthy or have high salary’s, they’re just bad with money

lepinkainen,

Saving is slow and boring, it’s easier just to get a credit card and buy something cool. Much more of a rush va seeing a number go up a tiny bit every month.

EatATaco,

Yeah, I’m curious as to what percentage of that group simply can’t afford to save, and the percentage that simply choose to spend instead. Like you, I know people who certainly could be saving money, but instead have new phones all the time and also are driving leased luxury cars.

bob_lemon,

I’m just going assume they wanted to say “not wired enough money to save” but forgot the middle part

EatATaco,

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