1/4 of Americans can’t pay their monthly bills

The Board of Governors of the Federal Reserve System just published its 172-page annual Report on the Economic Well-Being of U.S. Households in 2016.

First, the good news:

  1. “Overall, the modest improvements in financial well-being that were observed in recent years continued into 2016” with 70% of adults reporting “that they are either living comfortably or doing okay financially,” compared to 69% in 2015 and 62% in 2013.
  2. “Compared to previous years, fewer adults are ill-prepared for a modest financial disruption”.

These marginal improvements aside, the report contains some disturbing information although the U.S. supposedly is nearly eight years into an economic recovery:

  • As many as 30%, or approximately 73 million adults, are either finding it difficult to get by or are just getting by financially.
  • 13% of adults struggle to pay their bills in some months due to “income volatility” or month-to-month variability, while just under one-fourth of adults are not able to pay all of their current month’s bills in full.
  • 44% of adults say they either could not cover an emergency expense costing $400, or would cover it by selling something or borrowing money. (In 2013, the percentage was an even more alarming 50%.)
  • 47% of adults of adults report that their income exceeded their spending in the prior year.
  • 46% of adults with a credit card report that they are carrying credit card debt.

Some other findings:

  • Education, specifically a college education, makes a big difference:
    • 40% of adults with a high school degree or less report that they are struggling financially, compared to 17% of those with at least a bachelor’s degree.
    • 82% of adults with a bachelor’s degree or more in education said last year they were “living comfortably” or “doing okay,” up from 80% the year before, as well as 69% of those with some college or an associate degree, up from 66%.
    • 79% of those with at least a bachelor’s degree vs. 52% of those with only a high school diploma said they would still be able to pay all of their other bills in full if hit with a $400 charge.
  • Whites are slipping behind other races: “Non-Hispanic white adults with a high school degree or less are somewhat less likely than those of other races and ethnicities or those with more education to report that their financial well-being improved in 2016.”
  • 28% of adults who haven’t yet retired reported to being grossly unprepared, which suggests they have no retirement savings or pension.
  • Healthcare costs continue to be a burden:
    • 23% of adults had to pay a major unexpected out-of-pocket medical expense in the prior year.
    • 1/4 of adults report forgoing one or more type of health care in the prior year due to affordability.
    • Approximately 24 million people, representing 10% of adults, are carrying debt from medical expenses that they had to pay out of pocket in the previous year.

ZeroHedge reports that commenting on the report’s findings, Federal Reserve Governor Lael Brainard, a Hillary Clinton supporter, said:

“the survey findings remind us that many American households are struggling financially, including fully 40 percent of those with a high school diploma or less. More broadly, 44 percent of all respondents could not cover an unexpected $400 emergency expense or would rely on borrowing or selling something to do so. The survey also shows that many adults have no savings for retirement.”

~Eowyn

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16 responses to “1/4 of Americans can’t pay their monthly bills

  1. Deleonpatriot

    What about the people who, with Obama care, are left holding the bag for $3000 and up due to inflated “deductibles”? I’ll bet most of the population has a problem with that!

    Liked by 4 people

  2. The area I am currently living in has reported half of the population to be on the verge of poverty in two of the states more heavily populated areas. This did not exist thirty years ago. Considering the ruling elite is now getting double the amount of work for many families because now both Mom and Dad are working, I would say the only advantage is to the corporate elite. The standard of living I have witnessed has not gone up. The stress on families that it creates to ship your children off to day care and have both parents working could not be good for health. I read one article claiming cancer rates sky rocketed in the twentieth century and that a major cause of bankruptcy is from a medical crisis. Does a medical system work if it causes mass bankruptcy? I find it purely bizarre that a thriving city like Detroit was in the 1950s with a thriving automotive industry that has continued strong through the decades is now a drug slum demolishing homes to the tune of seventy thousand.

    Liked by 3 people

  3. The Fed speaks with forked tongue. Former Fed Chairman Allen Greenspan said the Fed’s goal was to end inequality of wages between
    the USA and China. Last time I checked average Chinese pay was
    83 cents an hour with no pension and no medical benefits. Looks
    like we’re well on our way down toward Chinese levels.

    Liked by 1 person

    • You are right. The Feds real raison d’etre is to fleece every last dollar out of the American people through fraudulent debt.

      They say this is a phony quote, but if the shoes fits……

      “The Jewish people as a whole will be its own Messiah. It will attain world dominion by the dissolution of other races, by the abolition of frontiers, the annihilation of monarchy, and by the establishment of a world republic in which the Jews will everywhere exercise the privilege of citizenship. In this new world order the Children of Israel will furnish all the leaders without encountering opposition. The Governments of the different peoples forming the world republic will fall without difficulty into the hands of the Jews. It will then be possible for the Jewish rulers to abolish private property, and everywhere to make use of the resources of the state. Thus will the promise of the Talmud be fulfilled, in which is said that when the Messianic time is come the Jews will have all the property of the whole world in their hands.” (Baruch Levy, Letter to Karl Marx, La Revue de Paris, p. 54, June 1, 1928

      Like

  4. I work with many folks who live paycheck to paycheck. Yet the majority of them have the latest smartphone and nicer cars than my 16 year old car. And they have the monthly payments to go along with those items (not me). Sometimes it’s a matter of controlling your purchase desires, IMO.

    Liked by 5 people

    • You’ve got me beat. My auto is only 11 years old. However, we do have a ‘vintage’ pick-up, which is 33 years old, and a 28 year young truck.

      Liked by 2 people

      • Those old trucks, taken care of properly, go forever. And they are oldies but goodies 😊

        Liked by 3 people

      • Another advantage to owning a vintage vehicle is they’ll still run if we experience an EMP attack.

        Liked by 2 people

      • My newest truck is 33 years old (currently broken),but I’m now driving a 36 year old pick up (also broken,but not terminal yet) I have a 63 year old Two ton work truck,but can’t afford the mileage it gets unless someone will “donate” a tank of gas for me to tow or haul something for them. On the plus side,they’re all paid for,and they cost me substantially less than their worth at the time,so I believe I’m okay there.
        I’m trying for a re-fi to pay off my creditors,which will bring my payments down to a point where I can actually wrap up every Month in the black! This is pending my getting about $7,800.00 in home repairs completed (to pass the Appraisal) and a sewer line replaced (NO sewer for the last 3 weeks),which I’m trying to get a USDA Grant to cover (Health hazards). What a Circus this is turning into!!!

        Liked by 1 person

        • Good luck w/the sewer line replacement…sounds like a big pain in butt.

          Liked by 1 person

          • Thanks DCG-it’s being a big pain everywhere. I feel like these people don’t understand the path these needed repairs could take if they don’t turn up the heat a little and get the estimates done. My home could be condemned,I could end up homeless. I know-that’s not likely to happen,but it DOES happen to others in our Country EVERY DAY. I guess it’s easy for a Contractor to get a little lax when he has full access to a working toilet,shower,laundry and sinks to wash dishes. I called all the Contractors this AM;two just won’t have time to do the estimate for another 3 weeks to a Month,one is allergic to Cats and can’t do the job,one just sent his amended quote today (Just got it and sent it to USDA),and one will try to stop by today and look the job over and SAYS he’ll get my estimate done ASAP. (The line they’ll put on my Grave stone applies here-“I’ll believe it when I SEE it.”) Meanwhile,the guy across the alley from me called the same Contractor to replace HIS sewer line a month after I called,but had the money available to pay $7500.00 up front and $7500.00 at the finish. They have only some clean-up dirt work left to do on his job. I honestly don’t begrudge him getting in before me-I’m glad he got such quick results. Shows what happens when we have to rely on the Government to get things done though.

            Liked by 1 person

  5. I’m sure the Fed Reserve governors are losing lots of sleep over this report. (Ha.)

    Liked by 2 people

  6. This is the saddest of all situations . . . I wonder how many of the folks standing in line at Starbucks are among those who are UNABLE TO PAY THEIR MONTHLY BILLS? One phenomena that our society is currently faced with is that individuals want all the goodies . . . cable tv, a cell phone for all members of the family over the age of 12, acrylic nails for women, the list goes on and on and on . . . . . . Back in the time during the great depression and up until the, perhaps early 1960’s, people had the personal ethics that they lived within their means. Now women leave their homes, put their children in daycare, earn monies (a great chunk of which goes to support other women who have allowed themselves to become pregnant while being single) so that their families can have all the goodies they could possibly want. Yet, we are poorer in spirit for all this foolishness, and it is destroying our society. Case in point . . . look at the fact that fights break out on airlines, etc.

    There is no doubt that the secret leaders of the world, those who would surrender us to a One World Government, want each and every family to have less and less monies to live on . . . it is far easier to subjugate people who do not know if they will continue to have a roof over their heads, and food to feed their families.

    There is little doubt that ALL children should be pushed to seek some type of higher education, whether it is college, or a trade school. Just look at yesterdays news . . . soon automation will cut severely into retail clerking jobs. When I go to the store, normally I go to the “self serve” check-out. I know how I want my groceries bagged (i.e. don’t put my loaf of bread in the bottom of the sack and then pile cans of soup on top of it.)

    Some time back I marveled at seeing a clip that showed (in SLC) apartment units that were being built for “the needy.” Each unit had their own washer/dryer, garbage disposal, and dishwasher. When the needy can live in circumstances which are better than many who are paying their way, there is something wrong.

    I just don’t know what is going to happen when the burgeoning numbers of our society hit retirement, when they have saved N-O-T-H-I-N-G for that eventuality.

    So much of what we see, I perceive, is from a lack of personal control over financial matters and how to utilize monies. So many people feel they have no responsibility for themselves . . . that the government will need to figure out how to take care of them in their old age. I wonder how that will work out when we need to tighten our belts in order to pay the immense indebtedness that we current linger under?

    Dr Eowyn . . . this is an excellent article! For any who are not prepared for the future, we need to work towards that end . . . and teach all of our family members the importance of frugality, and managing monies appropriately.

    Liked by 3 people

  7. Whenever I attempt to explain to passengers in my cab that these economic woes are PLANNED, almost every single person DUMMIES UP and tries to deflect, change the subject or gaslight me. People KNOW there are problems; But they WILL NOT be educated or shown the light—ANY LIGHT—on anything by anybody. People WILL NOT be shown the way out of their own normalcy bias or cognitive dissonance. So it’s time for me to move on to another venue. Certainly the rideshare platforms I drive on haven’t helped me out economically: My own income—EVERY NYC DRIVER’S INCOME—is down, by 30% or even more.
    People don’t get it: SERFDOM IS ON THE WAY. People want to bitch and moan, but they WILL NOT be led out of their cave.

    P.S.:
    Donald Trump cannot get us out of the conundrum. And I am coming to perceive he has no intention or inclination of doing so.

    Liked by 1 person

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