Monday, November 02, 2015

60% of Households Experience Financial Shocks

In a year's time, most households experience a financial shock, according to Pew Charitable Trusts Survey of American Family Finances. In the survey, Pew asked a nationally representative sample of Americans whether they had experienced any of the following unexpected financial shocks: income cut; hospitalization; separation, divorce, or widowhood; major vehicle repair; major housing repair; or some other large unexpected expense. The 60 percent majority of households had experienced one or more shocks in the past 12 months...

30% had a major car repair
24% had a major home repair
24% experienced a hospital trip
24% experienced a pay cut
3% experienced separation, divorce, or widowhood
10% experienced other large, unexpected expenses

How much do these shocks set people back? The median cost of the average household's most expensive shock was $2,000, says Pew. Such shocks have psychological consequences. Among households that did not experience a shock, 64 percent reported feeling financially secure. Among those who did, only 41 percent felt secure. In the coming weeks, Pew will examine the resources available to families to help them weather these all too common financial shocks.

Source: Pew Charitable Trusts, How Do Families Cope with Financial Shocks?

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