Over half of Americans say they're not even close to financial freedom
Over half of Americans say they're not even close to financial freedom
About 36% of U.S. adults say they have less than $1,000 in their savings accounts.
For analysis of the political views of that media: https://ground.news/article/over-half-of-americans-say-theyre-not-even-close-to-financial-freedom
This is a pretty terrible article that takes an important issue (financial insecurity in the US) and manages to say absolutely nothing about it.
Half of Americans describe "financial freedom" as being comfortable, but not necessarily rich, and 49.3% say it refers to meeting financial obligations and having some money left over each month. About 54.2% define it as living debt-free, and 46.2% believe it means never having to worry about money.
Okay, so they don’t define “financial insecurity,” but leave the definition up to the people taking the survey? And the definitions themselves are all over the map and don’t have an objective interpretation. “Meeting financial obligations?” That just says that people want to be able to live within their means, but not how they live.
Even the bit about savings accounts is problematic. A lot of people don’t have savings accounts because most people don’t bank that way any more. In our parent’s generation (and I am speaking as someone who is 50) savings accounts were where middle class and below people kept their money because it was an interest bearing account and things like the stock market and bonds were intentionally well out of reach of the average person. I do have a savings account but I really don’t need one and its balance has absolutely no correlation to how much money I have.
The percentage of people living paycheck to paycheck, the amount of savings (in terms of monthly expenses), or having to defer things like medical treatment or car repairs are all more meaningful metrics, IMO. Even net worth inclusive and exclusive of the primary residence would be meaningful.
I technically have less than $1k in my savings because my money is in a brokerage account. I have quite a bit more in Treasury bills and money market funds, but those technically aren't savings accounts.
Others may keep their money in checking instead, which also isn't savings.
I'm not sure what the wording was on the survey, so maybe others took it more literally, or maybe they don't consider their emergency funds to be part of "savings." I find questions like "could you handle an unexpected $1k expense without taking on more debt?" to be more interesting.
Not too long ago the number was around 50% and not having $500 in the bank, so at least this is technically an improvement
That was actually a study that was completely misrepresented by the media. What the people actually said in the study is that if they were presented with an unexpected expense of $500, they would charge it, not that they didn't have the money. But then unscrupulous mukrakers took that study and reported it as "50% of Americans say they don't have enough cash to cover an unexpected $500 expense!". There are plenty of valid reasons to charge an unexpected expense, regardless of how much money you have in the bank.
Oh wow that's wild
Edit: No, that doesn't seem to be the case. I'm seeing multiple sources (go banking, bankrate, Princeton) all corroborating the lack of savings. It looks like bankrate does the surveys annually too: https://www.bankrate.com/banking/savings/emergency-savings-report
Bankrate doesn't ask the savings number directly so that's maybe what you were seeing, but go banking does:
"Methodology: GOBankingRates surveyed 1,002 Americans aged 18 and older from across the country on between January 30 and February 1, 2023, asking six different questions: (1) How much savings do you have?; ..."
If the respondents are defining "financial freedom" of course they're going to say they don't have it.
I make a decent salary and I would still say I don't have financial freedom.
That's because financial freedom is defined by social safety net (for non-bourgeoisie).
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It's not something that you earn as an individual, but achieved as a society.
No matter how much money I have, I won't be financially free until the day I officially RETIRE. As long as I have to work, I'm not free.
A bunch of people say they do have it, though. A "decent salary" (also self-defined) doesn't guarantee financial freedom because of things like debt, the astronomical cost of healthcare, and the fact that you'll never be able to comfortably retire unless you're a literal multimillionaire.
what is financial freedom? like, never having to worry about money?
because even billionaires aren't financially free then.
Financial Freedom is owning enough capital to not have to actually work.
With the interest rates of savings accounts why bother. Just leave it in checking. Or cash.
Or are we trying to act surprised most people don’t have money?
it's just further evidence that the rot in the economy is reaching a critical point. either some socdems push through reforms so the system can limp on or we'll hit the 3 days of missed meals tipping point.
So instead of 1% interest your suggestion is 0% interest?
savings and COD are 4-5+% right now.
Interest rates are like 5%
Democracy is when everyone is desperately poor no matter how hard or smart they work.
Which is still better than having extremely poor and extremely wealthy people.
I should have clarified. In Amerikkka, there is a large number of extremely poor people (proletariat), a small number of people who are doing better and who therefore believe that capitalism is normal (labor aristocrats and petite bourgeoisie), and a tiny minority of haute bourgeoisie who control the country and think that it’s funny and strange that anyone supports them.
Hmm that looks like a nice wallet. Wonder which one it is.
what's a saving account? /s
It's a place to keep your money while it loses value over time.
Interesting that people’s lowest income expectation has increased. Hopefully that leads to more industrial action.
