Majority of Americans can’t pay for an emergency expense with savings: Survey

By , KYW Newsradio

Only 39% of Americans are able to comfortably dip into their savings to pay an emergency $1,000 expense, such as a car repair or emergency room visit.

The rest of us would have to put it on a credit card or borrow the money, according to a recent survey from Bankrate.

The survey found 18% of respondents said they could handle a surprise expense without borrowing, though they would have to rearrange their budgets. Another 18% opted for the credit card.

An additional 12% said they would borrow from family or friends, and 8% said they would take personal loans.

But for the most part, Greg McBride, Bankrate chief financial analyst, said people are generally optimistic that their finances will get better soon.

“Despite what a bad year it’s been economically, there’s a lot of optimism that people are feeling that their financial situation is going to improve in 2021,” he said.

“Those expecting their finances to improve in 2021 outnumber those expecting them to deteriorate by a 3-1 margin, and that’s not something we typically see.”

More than 40% are optimistic about the future. McBride said younger millennials are the most optimistic, while people 66 and older lean the other way.

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