Can You Cover An Emergency Expense?

[Senator]

Since we are on a poll kick, here is one.

I think we have a biased selection of people here, but maybe we are just ‘ordinary’. I read a recent article about how much money people could come up with. I know in my early days as a landlord, some tenants had a difficult time with money.

I may not have much in my wallet at any given time, maybe $40 on a ‘refill’ day. But I do have enough credit cards and access to funds I could spend quite a bit, if needed. I just bought a house for almost $40K and it didn’t even put me into any reserve cash.

Could you cover an unanticipated expense, or a great investment, of a few thousand? Were you ever in a position where even a few hundred was a big stretch? Even in HS, I could come up with a few grand, so it’s hard for me to understand.

The Fed asked respondents how they would pay for a $400 emergency. The answer: 47 percent of respondents said that either they would cover the expense by borrowing or selling something, or they would not be able to come up with the $400 at all.

And another one…

A 2014 Bankrate survey, echoing the Fed’s data, found that only 38 percent of Americans would cover a $1,000 emergency-room visit or $500 car repair with money they’d saved.

And even the ‘rich’ households have trouble…

The Bankrate survey reported that nearly half of college graduates would not cover that car repair or emergency-room visit through savings, and the study by Lusardi, Tufano, and Schneider found that nearly one-quarter of households making $100,000 to $150,000 a year claim not to be able to raise $2,000 in a month.

Many Middle-Class Americans Are Living Paycheck to Paycheck - The Atlantic

 

[jfn111]

The wife starts to get nervous when the checking account balance gets under $25,000.

 

[Ginny]

Yes, hundreds or thousands with credit card or a check.

 

[scrabbler1]

I answered "anything under $50k" because I could simply write a check on one of my mutual fund accounts which have just under $50k in it. Over $50k I'd have to write multiple checks or transfer some money around.

 

[38Chevy454]

I would need to tap into my real savings accounts, but could cover up to $50K without much issue, just a couple days to get the money. I don't keep much in local bank accounts, so that would be $2500 limit if I needed cash today.

 

[easysurfer]

10K to 50K on the poll is a pretty big jump. When I needed a fairly new used car to replace the one that died, about 20K later, I paid in cash and wasn't that much pain. But 50K, I dunno.

I voted for under 10K as I like to choose below my means .

 

[NW-Bound]

My after-tax accounts are good for anything below a mid 6-figure number, but I may need a couple of days for fund transfer. Above this level, I would need to draw on before-tax accounts, and the tax levied needs to be considered.

I have to go back to the early 80s to be at a time when I could not get $50K cash for emergency. And that was in my late 20s, and just a few years out of college.

Nope, I was not rich, nor made a boatload of money. I just love to keep some money around than to spend it. Even while in college, I always had several thousands, just for the pleasure of having it.

 

[HFWR]

Yes, I could cover a few thousand, and yes, I've definitely experienced times when even a few bucks would have been hard to muster...

 

[tmm99]

I can cover a lot, but the question is if I want to. I don't want to, but I will.

 

[calmloki]

Yep.