Only 55% of Americans Have More Savings Than Credit Card Debt
I read an alarming story this week from Bankrate’s 2013 February Financial Security Index. It found that only 55% of Americans have more savings than they do credit card debt. Keep in mind, this is ONLY talking about credit card debt. It does NOT include student loans, car loans, rent, cell phones, mortgage, or any other obligations or debts that most American’s incur. I presume that the number would fall sharply closer to 5% if the study had taken all of that into consideration. Moreover, what concerned me just as much was how the article was insinuating that 55% of people having more savings than credit card debt was really high. As in this is a number that America should be proud of. What a joke! This basically means that over 40% of our country is in financial ruin (and probably a whole lot more if we could really see people’s financial statements). It wasn’t that long ago that credit cards didn’t even exist and almost all Americans had more in savings than they did on credit, on their tabs at local stores, etc.
The other alarming piece to this puzzle is that according to the Department of Commerce, credit card debt has come down and savings have gone up since the financial collapse of 2008. So this 55% number is higher than it was just a few years ago. I find it scary that this many people in America don’t feel the pressure to save money while continuing to keep spending, deferring the inevitable, and “putting it on the card”. If almost half of American’s have more credit debt than they do in emergency funds, we are in serious trouble. Let’s face it, America is broke…
These alarming results make it clear that financial advisors and retirement income specialists have a huge task ahead of them. There is a complete retirement education overhaul that needs to be done in our schools, our universities, socially, and throughout all media channels. If you don’t think that this will ever catch up to us in the next recession, then you are a dreamer. Let’s wake up America and start saving, and start being fiscally fit. How can we yell, kick, and scream about our government spending too much when half of us are just as guilty.