Over on The Simple Dollar someone asked about an article on CNN with the headline of "6 in 10 Americans don't have $500 in savings" The QA exchange on that was someone asking if that is real and Trent saying he believes it.
I don't believe that 60% of Americans don't have $500.
It seems that we're told by the press over and over that most Americans are living paycheck to paycheck or don't have $1000 or $500 or $X in the bank or similar things. I've generally accepted this in stride as most people probably do.
But here's the big problem with that claim. Its based on a survey from Bankrate that asked people how they'd handle an emergency bill. But I can't find any real details on how the question was asked. If they just asked "how would you pay for a $500 -1000 emergency expense?" and the answers were just a list of items like savings, credit card, cut spending, etc. then you'll get some wrong results there. I personally would use a credit card and I'd answer that way. The article then assumes (wrongly) that I don't have $500 in savings. But I use credit cards for most everything to get my bonus points.
Survey of Consumer Finances of 2013 has a lot of data on personal finances. They say specifically how many people have checking and savings accounts and what the mean and median balances are. 93.2% of people have accounts and the median balance was $4100. That means that 46% of people have over $4100. This specific data directly refused the idea that 60% (6 in 10) of people don't have $500 in savings.
I'm sure that there are is an unfortunately high amount of people in the nation who don't have $500 available. But its not 60%.
--
June 27, 2017
No, Most Americans Aren't Totally Broke
Posts
