American Families Are Trapped in a Cycle of Financial Struggle — And It’s Not Just the Poor
A car repair, a medical bill, a sick family member, a tax bill, a leak. All of these could easily cost $2,000, and for more than a third of U.S. households, they represent an insurmountable challenge. A growing number of families are trapped in a cycle of financial struggle, and it’s not just the poor.
According to the Center for Financial Services Innovation (CFSI), one in three American households today can’t cover a $2,000 emergency expense — the types of things that can happen to anyone at any time. And these aren’t just low-income households; one in five of households making more than $75,000 a year say they are not confident that they could cover the $2,000 emergency.
Many of these families appear to be financially healthy, with jobs, homes, health insurance, and even college degrees. Beneath the surface though, they have little to no wiggle room. To understand why, we need a more complete picture of households’ financial lives, including their income, expenses and balance sheets — what they save, own, and owe.