Most Americans happy with contingency plans, despite pandemic stress
But survey finds those with less money are unlikely to be prepared
Anyone who has felt a sense of not being prepared for an emergency would probably agree that the best time to start saving for a crisis is yesterday.
No one likes to be caught off guard – especially financially – which could explain why 63% of Americans say they are happy with their plans for the next emergency, according to one. recently published survey from credit and identity security company ScoreSense.
While being happy with a contingency plan does not necessarily mean that every respondent is fully prepared, it is a great first step.
63% of Americans are happy with their emergency plans
Despite a year of economic volatility and seemingly endless surprises, nearly two-thirds of consumers surveyed felt comfortable with their plans and their ability to cope with the next crisis, whenever it strikes.
Yet ScoreSense also found that 26% of consumers had no emergency financial plan in place at all.
Unfortunately, many of those who do not have a plan in place could find themselves in this situation because their current financial situation is particularly dire. The survey found that almost half of respondents earning $ 25,000 or less were among those without a contingency plan.
In contrast, a majority of 59% of respondents expected to increase their savings in order to prepare for the future.
Pandemic recovery is choking economies
While many consumers are considering replenishing their savings accounts, the survey also found that more than a quarter of those who lost their jobs during the COVID-19 pandemic are actually living off their savings.
Even as the end of the pandemic draws closer and closer, those hardest hit will likely continue to struggle to recoup those losses for some time afterward.
The good news is that a majority of respondents were not adding new debt – whether through new credit cards, personal loans, or other means – despite the financial stress they face. The proportion of those incurring additional debt varied by age, but even among millennials (the group most likely to borrow), 66% had not applied for any new debt during the pandemic.
When it comes to the types of debt incurred in an emergency, Gen Z and Gen Y were the most likely to add a new credit card to help in a pinch (19% and 21%, respectively). Additionally, these two groups were also the most likely to start secondary agitation to make ends meet (39% and 22%, respectively).
Gender gap in emergency preparedness
ScoreSense researchers found interesting correlations between gender and emergency savings, with men reporting slightly more confidence in both the overall economic recovery and in their personal preparedness.
The survey found that women were almost twice as likely as men to be dissatisfied with their current emergency plan (21% vs. 11%). This is not too surprising, given the gender pay inequality that persists in the United States – which has been exacerbated by well-documented and disproportionate job losses. women have been confronted throughout the pandemic.
Looking to the future, many consumers do their best to anticipate the unexpected. And at least part of the current attitude toward preparedness, ScoreSense research noted, is the result of the global pandemic, which has remodeled the environment for many facets of life, from health care at retirement.
Methodology: The consumer research company PeopleFish conducted this survey on behalf of ScoreSense. PeopleFish surveyed 1,080 U.S. consumers aged 18 and over in June 2020.