Despite the adoption of more frugal money management strategies, many Americans have yet to restore the wealth they once enjoyed prior to the housing collapse and the Great Recession, a new report shows.
The Federal Reserve Bank of St. Louis released findings that show household wealth declined $16 trillion between the third quarter of 2007 through the first quarter of 2009. As of 2012, Americans have only been able to regain 45 percent of that amount, most of which was attributed to gains in the stock market, rather than increased savings, debt repayment and the accumulation of retirement income. As a result, this suggests that many families who were struggling to make ends meet prior to the recession continue to face financial adversity.
“A conclusion that the financial damage of the crisis and recession largely has been repaired is not justified,” the report stated.
Millions of Americans report they are still living paycheck-to-paycheck, and separate reports reveal that a large percentage of individuals would be unable to come up with $500 in cash in the event of an emergency. As food, gas and rental prices continue to rise, consumers who are having difficulties making ends meet should consult a professional, such as a credit counselor or advisor, to outline a financial path that will help them strengthen their money profile..