Nearly Half of Americans Are ‘Financially Fragile’

Wall Street Journal Blogs ^ | May 25, 2011 | Phil Izzo

[rightwingintelligentsia]

Nearly half of Americans say that they definitely or probably couldn’t come up with $2,000 in 30 days, according to new research, raising concerns about the financial fragility of many households.

In a paper published by the National Bureau of Economic Research, Annamaria Lusardi of the George Washington School of Business, Daniel J. Schneider of Princeton University and Peter Tufano of Harvard Business School used data from the 2009 TNS Global Economic Crisis survey to document widespread financial weakness in the U.S. and other countries.

The survey asked a simple question, “If you were to face a $2,000 unexpected expense in the next month, how would you get the funds you need?” In the U.S., 24.9% of respondents reported being certainly able, 25.1% probably able, 22.2% probably unable and 27.9% certainly unable. The $2,000 figure “reflects the order of magnitude of the cost of an unanticipated major car repair, a large copayment on a medical expense, legal expenses, or a home repair,” the authors write. On a more concrete basis, the authors cite $2,000 as the cost of an auto transmission replacement and research that reported low-income families claim to need about $1500 in savings for emergencies.

Financial fragility isn’t limited to low-income groups. “Households with socioeconomic markers of vulnerability (income, wealth, wealth losses, education, women, families with children) are more likely to be financially fragile, and substantially more so,” the authors write. “The more surprising finding is that a material fraction of seemingly ‘middle class’ Americans also judge themselves to be financially fragile, reflecting either a substantially weaker financial position than one would expect, or a very high level of anxiety or pessimism. Both are important in terms of behavior and for public policy.”

[Gene Eric]

I know where you’re coming. Unfortunately, you’re wasting your time on others that don’t.

We’re target #1 in the eyes of the Commies.

[RFEngineer]

“But I doubt we’ve heard the last from a person who uses a keyboard to bully other people anonymously.”

We’re all here as long as we’re allowed to be. However, I’m not in any bullying you or other people.

[Flying Circus]

You sound really insecure about the work you are doing. Understandably so if you never have had to compete in the private labor market.

To even suggest that somehow the Obama administration is sowing disdain for government workers and their pensions is the height of ridiculous. Government workers are the Obama administrations natural constituency and the group who have benefited most by the dramatic increase in federal expenditures. No, it is not the Obama administration raising disdain for government workers compensation and benefits.

It is a natural reaction of the rest of us getting a peek at the extravagant pensions the political class have promised to their quislings out of our tax dollars. Traditionally we’ve taken for granted that public workers get job security and a nice pension for accepting smaller salaries. Private sector workers are struggling with job security, increasing competition from foreign labor and now a political class salivating at the chance to grab our meager 401k and IRA savings because we are ‘rich’ so they can fund even more bureaucratic growth. For public workers get the trifecta of higher salary at the same skill level, gold plated pensions (jobs like teachers, lifeguards, police officers and firefighters getting pensions with an estimated $1.3M lifetime value), and bulletproof job security on the backs of those private sector workers is a deep and grave injustice.

[Reddy]

ITA with your third paragraph.

I disagree with the second paragraph. Zero is using Alinsky tactics to demonize gov workers with one hand and taking their pensions with the other. He’s making it APPEAR he cares about fed workers, etc. Just like everything else he does- the people of this country, no matter who they are, are mere fodder for his utopian idea of a socialist nation.

As for your first paragraph, nope. Have always worked in the private sector.