“If I were to make a Netflix special about the US economy, I think it'd be titled paycheck to paycheck.”
That’s Mark Hamrick, a senior economist at Bankrate.com. He tells KMOX that though the U.S. economy is expanding, the broadest parts of the American population are living from paycheck to paycheck — and more than half of Americans are unable to pay an emergency expense of $1,000 or more.
“And when we ask the question, specifically, ‘How would you pay such an emergency expense?’ 43% say they would take that from savings and — the highest we've seen in the nine years we've asked these questions — 25% say they would put it on a credit card and pay it off over time,” Hamrick said.
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Hamrick said the pandemic had unexpected effects on people’s ability to save. Early on in the pandemic, he said, the country had a savings rate where around a third of disposable income was being saved in a given month.
“That was historically remarkable. And between the continued rate increases on the part of the Federal Reserve, the high inflation that we've had for the broader part of a year, essentially, household finances have buckled under,” he said. “And now people are basically saving nothing at 2.7 percent.”
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