“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.
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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