Corporation for Enterprise Development released an interesting report this week that highlights how bad households are when it comes to their finances. It concluded that nearly half (44 percent) of American households do not have enough savings and are one financial emergency away from economic disaster. Last year’s report had similar findings.
The study was first reported in the Huffington Post that spoke with an average middle-class family of five in Delaware. The family owns two cars, the husband and wife have full-time jobs, the children participate in after-school activities and they own a big three-bedroom house. The article noted that they have $223 left in their bank account at the end of January.
Indeed, this is a troubling issue for most Americans and there is validity to the matter, but the case above can be easily rectified: finding efficiencies and cutting back. This is the case of a family living beyond its means.
What was also interesting in the article was that the analysts blamed stagnating wages, the one percent and the rising cost of living. However, there was no mention of the Federal Reserve’s inflationary and low-interest rate effects on the economy and to those who save.
Economic Collapse News has reported in the past as to how bad it is for all Americans, but a lot of households can survive if they learn to live within their means.