A quarter of Americans have more credit card debt than emergency savings, according to a survey released today by Bankrate.com. Just 54 percent of Americans have more savings than credit card debt, and 16 percent have neither credit card debt nor emergency savings.
The finances of individuals who earn the least and those who have fewer years of education are the most out of whack, according to Bankrate.com’s Financial Security Index, which measures how secure Americans feel about their finances each month, MSNBC reported. Some 70 percent of Americans making at least $75,000 a year have more savings than credit card debt while only 40 percent of Americans making less than $30,000 a year do. Also, 64 percent of college graduates have more savings than credit card debt versus 46 percent of Americans with a high school education or less.
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"Emergency savings remains a problem area for many Americans, which leaves them only one unplanned expense away from having high-cost debt," Greg McBride, senior financial analyst at Bankrate.com, said, according to the Los Angeles Times. "As difficult as it may be to boost savings, having an adequate emergency savings cushion is critical to maintaining financial stability, and Americans need to find ways to sock away more cash for a rainy day."
The poll participants seemed aware of the dangers of not saving. Twenty-seven percent of respondents said they felt less financially secure compared with last year, the LA Times reported. (Twenty-four percent felt more financially secure.)