How did emergency savings levels change for US households?

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Emergency Savings Showed Marked Improvement Among US Households

In 2021, the proportion of US adults capable of covering a US$400 emergency expense with readily available funds reached its highest point in the survey's history, with 68% reporting this capability. This figure represents a significant increase from 2013, when only 50% of adults could manage such an unexpected cost. This improvement in financial resilience occurred prior to the acceleration of inflation and the subsequent aggressive interest rate hikes by the Federal Reserve.
Highest Level of Financial Readiness Recorded

The Federal Reserve's annual Economic Well-Being of US Households report indicated that self-reported financial well-being reached its peak since the survey's inception in 2013. In 2021, 78% of adults described their financial situation as "doing okay" or "living comfortably." This overall positive trend in personal finances was observed across all racial and ethnic groups, with a particularly notable increase among Hispanic adults.
Significant Increase in Emergency Expense Coverage

The ability of US adults to cover a US$400 emergency expense, such as a car repair, using cash or a credit card saw its highest recorded level at 68% in 2021. This contrasts sharply with the 50% of adults who reported this capability in 2013, demonstrating a substantial growth in financial preparedness over the period. The survey, conducted in October and November 2021, captured this financial strength before the full impact of rising inflation became a dominant economic concern.
Persistent Challenges Remain

Despite the overall positive trends in emergency savings, a segment of the population continued to face financial difficulties. The report highlighted that 11% of adults stated they could not cover an emergency expense through any means. Furthermore, nearly a quarter of adults reported struggling to pay their bills in the month of the survey or being close to such a situation, indicating that financial precarity persisted for a notable portion of households.

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How did emergency savings levels change for US households?

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