Survey: Majority of Americans Uncomfortable with Emergency Savings as Balances Decline
A recent Bankrate report found that 34 percent of Americans have less emergency savings than they did one year ago, and only 24 percent have more. Consequently, 58 percent of Americans are now uncomfortable with the amounts they have saved, up from 48 percent in 2021 and 44 percent in 2020.
“The percentage of Americans who are comfortable with their emergency savings has gone from 54 percent to 42 percent in the past two years, while those uncomfortable has jumped from 44 percent to a majority 58 percent,” said Greg McBride, chief financial analyst at Bankrate. “Inflation at the highest levels in 40 years will erode the comfort level with, and buying power of, your emergency savings.”
Among the 42 percent that are comfortable with their emergency savings, 82 percent have at least three months of expenses saved. For those who are uncomfortable with their savings, 75 percent have either less than what would cover three months of expenses, or no savings at all.
23 percent of Americans have no emergency savings, which is among the lowest levels reported in 12 years. Alternatively, 27 percent of households have savings to cover at least six months of expenses, the highest seen since 2018. 22 percent have savings to cover three to five months of expenses, while 28 percent have some savings, but not enough to cover three months.
“Even with fewer households having no emergency savings and 56 percent having the same or more savings than one year ago, the majority of Americans are uncomfortable with the emergency savings they have in 2022, a change from the previous two years,” McBride said.
The report also found that 40 percent of Millennials have enough savings to cover at least three months of expenses, compared to 47 percent of Gen X and 62 percent of baby boomers. Only 38 percent of Millennials are comfortable with their savings, compared to 41 percent of Gen X and 49 percent of baby boomers.
Only households earning $100,000 or more yearly have a majority that feel comfortable with their savings, compared to 31 percent that feel comfortable with their emergency savings earning less than $50,000 annually. Additionally, in households earning less than $50,000 annually, 37 percent have no savings, while a majority in all income groups earning at least $50,000 can cover at least three months of expenses.