I read an interesting article today that stated a majority of Americans could not afford a surprise expense of $1000 or more.
I wouldn’t be surprised if the number was lower, say a $500 dollar surprise expense. Inflation has pushed living expenses to an almost unsustainable level for lower income earners.
It really is a depressing thought that a majority of people barley earn enough to cover their monthly expenses.
Let’s take a look at the personal savings rate over the last 5 years.
As you can see from the chart above, the personal savings rate is hovering around 3.8%. With fuel prices headed higher, I would not be surprised if this touches the June 2022 low of 2.7% again.
High inflation and high interest rates are the culprits of the below trend savings rate. Things are starting to look a little brighter for the economy in terms of interest rates and credit, high prices are here to stay for the consumer.
Money Fad 