Figure 4 shows that far more Americans want this opportunity than currently have it. Similar to 401(k)s, these accounts have the power of being linked to payroll, which means that, with a worker’s permission, employers can deposit a share of each paycheck directly into an emergency savings account that the employee could access, penalty-free, at any time. One promising tool to help them is an employer-based emergency savings account. 1 Workplace retirement plans are an essential, tax-advantaged savings vehicle, and far too few Americans have access to one.īut as our survey shows, Americans need help not only saving for retirement, but also for emergencies. Share who say they have no money set aside for emergenciesĪmericans want their employers to help them save for emergenciesĬonsistent with other sources, BPC’s survey finds that only 67% of workers report having the opportunity to contribute to a retirement plan through their employer. Share who say they are somewhat or very financially insecureįigure 3: Many disadvantaged workers have no emergency savings Figure 2: Disadvantaged workers report financial insecurity The large disparity in financial wellbeing between women and men in these indicators is particularly striking. Meanwhile, 59% of Black respondents say they either couldn’t fully pay for a $400 emergency expense or would do so by going into credit card debt, taking out a payday loan, borrowing money, selling something, or turning to their retirement accounts (compared to 42% of white respondents).Īs Figures 2 and 3 show, disadvantaged workers are far more likely to feel financially insecure, and this insecurity is related to a remarkable lack of savings. If workers lost their source of income, nearly half (44%) of those in houesholds making less than $50,000 per year report that they could pay their bills for approximately one month or less out of their savings on hand. This lack of savings is a lack of protection against the unexpected. This combination leaves such workers both particularly exposed to negative shocks and particularly vulnerable when those shocks arrive.įor instance, BPC’s survey finds that 43% of adults in households with incomes less than $50,000 a year report having no money set aside for emergencies, compared to only 8% of respondents in households earning more than $100,000. ![]() Perversely, however, these Americans’ lower incomes make it especially hard for them to pay their bills, let alone put money aside to save. Thus, they are most in need of a buffer of savings. People with low incomes, workers without college degrees, and workers of color have more volatile incomes and more tenuous job security. The California Effect Seen Through Children’s Online Privacyīuilding Higher Education Rainy Day FundsĬOVID-19 has damaged Americans’ financial health This evidence further underscores the urgent need for policymakers and corporate leaders to implement solutions that can make workers more financially secure. The survey reveals an alarming picture of Americans’ low savings, inadequate access to savings vehicles, wide disparities in savings and account access, and a broad desire for tools that could help build savings to protect them when the next crisis-whether national or personal-hits. ![]() These are among the findings from a new Morning Consult survey commissioned by BPC-conducted in partnership with Funding Our Future and Edelman Financial Engines- for America Saves Week, an annual week-long effort focused on helping Americans save more and highlighting how employers and policymakers can facilitate saving. ![]() But the impact was so severe in part because too many households are chronically short of savings that could protect them against unexpected losses of income or surprise expenses. Give Search Keywords Submit Policy AreasĬOVID-19 has damaged many Americans’ personal finances-especially those of women, people with low incomes, people without college degrees, and workers of color.
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