Credit debt outpaces emergency savings for many consumers
While Americans have generally become more fiscally responsible since the start of the recent economic downturn, many consumers have neglected to put their savings in an emergency account.
A new survey by Princeton Research Associates suggests that 23 percent of Americans now owe more in credit card debt than they have stored away in emergency savings accounts.
Nearly 33 percent of survey respondents between 30 and 49 reported having more debt than savings, the highest amount observed in any of the study’s test demographics, Accounting Today reports. By comparison, consumers under 30 were the most likely to have a greater amount of money stored in these accounts than they owed to lenders.
In addition, the study found that only 15 percent of consumers were more comfortable with the balances in these accounts than they were one year previously, the news source says.
Many financial experts suggest consumers use emergency accounts to prepare for an untimely car accident, or a medical procedure. This is because having money stored away for life’s uncertainties can keep consumers from racking up more credit card debt when these unfortunate events occur.