While Americans are still facing a drought of rainy day funds to handle unexpected emergencies this summer there might be a silver lining: grown children under the age of 30 appear much less likely to ask family for help than last year.
The annual survey of 1,000 Americans age 18 plus conducted by online lender CashNetUSA shows 22 percent of Americans have less than $100 in savings to cover an emergency expense while 46 percent report having less than $800. The survey documents a consistent percentage of individuals with varying socio-economic backgrounds living paycheck to paycheck again this year.
With no savings and facing down a financial emergency, only 30 percent would likely turn to a family member for a loan, versus 41 percent last year. Millennials, the 80 million young people born between 1980 and 2000 and known to be facing high unemployment and debt, might finally be giving their parents a break. In 2012, 54 percent of those under the age 30 would ask family for help. In 2013 that number dropped to 37 percent, though still above the national average of 30 percent.
“The scarcity of rainy day savings remains a concern for too many Americans, and it hasn’t improved since last year,” said Megan Staton, director of marketing for CashNetUSA, one of the country’s leading online lenders of cash advances to manage financial emergencies. “Americans are unprepared to handle financial emergencies and less willing to turn to family for help, especially young adults. Accessible and quick loans might be the only alternative for many who don’t have access to other sources of credit.”
While financial advisors often recommend that a family has six months of living expenses set aside in an emergency fund, the survey found:
- Fifty-six percent of Americans surveyed with children under the age of 18 report having less than $800 to handle an emergency.
- While the percentage of residents in the South and Northeast who report having less than $100 remained constant over the past 12 months, there was an increase this year from 18 percent to 25 percent among individuals living in the Western states. Those individuals in the North Central showed a decrease from 31 percent to 24 percent over the prior year.
- The number of adults, ages 50 to 59, with $800 or more in savings declined from 69 percent to 59 percent over last year, while those ages 40 to 49 increased from 47 percent to 56 percent.
With no savings and facing down a short-term emergency, only 30 percent would likely turn to a family member for a loan, versus 41 percent last year. The decline was consistent across gender, family ages and income status, but most pronounced among younger adults:
- In 2012, 54 percent of those under the age 30 would ask family for help. In 2013 that number dropped to 37 percent.
- For those living in the Western states, 24 percent would “definitely not” ask a family member for assistance (versus 14 percent one year ago), 10 percentage points higher than all other geographic areas.
- Those between the ages of 30 and 39 now rank as the most likely to ask for a family loan, though that number has decreased 10 percent from last year (48 to 38 percent).
- Women (33 percent) remain slightly more willing than men (28 percent) to ask a family member for a loan.
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