CFPB’s Making Ends Meet Survey Finds 24% of Consumers Have No Savings Set Aside for Emergencies and 39% Have Less than a Month of Income Saved

Last week, the Consumer Financial Protection Bureau (CFPB) released insights from its Making Ends Meet Survey and Consumer Credit Panel, which “examines how consumers’ financial profiles vary by levels of emergency savings.” Among the report’s findings were that 39 percent of consumers have less than a month of income saved for emergencies, while 24 percent of consumers have no savings for emergencies.

“Financial constraint resulting from obligatory expenses and insufficient income can impede consumers’ ability to save for emergencies,” the report reads. “At the same time, consumers’ access to traditional credit products—or lack of access—can also play a role in whether consumers are able to weather financial setbacks.”

The CFPB found that the level of emergency savings mostly increased with the level of household income. 60 percent of consumers with household incomes of $20,000 or less, 40 percent of consumers with incomes between $20,001 and $50,000, and 12 percent of consumers with household incomes between $50,001 and $80,000 have no emergency savings. For household incomes between $80,001 and $125,000, only four percent have no emergency savings; for households with annual incomes above $125,000 the figure drops to three percent.

Conversely, 15 percent of households with annual incomes of $20,000 or less have at least a month of income saved while 58 percent of households with annual incomes above $125,000 do.

The level of emergency savings also increases with the level of education; 41 percent of consumers without a college degree have no emergency savings. 30 percent of those with some college or a two-year degree have no emergency savings, and the share drops to 6 percent for consumers with a four-year degree or more.

Alternatively, roughly a quarter of consumers in the lowest two educational groups have saved at least one month of income for emergencies, and 55 percent of those with four-year degrees have a month of income saved.

“It is important to consider these disparities in the historical context of policies that limited the wealth building and upward mobility of non-White Americans, especially Black Americans,” the report notes. “Having sufficient emergency savings to withstand shocks better positions people to save for and invest in homeownership, retirement savings accounts, and other wealth building financial instruments.”