Saturday, May 23, 2009

Savings and Debt

One quarter of homeowners do have no savings. We would imagine that when the non-homeowners are factored in the savings level is even lower. And we really wonder of the three-quarters that claim to have savings have enough to carry them over for any substantial time period. Probably very few. Homeowner savings and some other interesting statistics are covered in an article from The Albany Business Review titled Survey: 25% of homeowners have no savings. Let's take a look -

Twenty-five percent of U.S. homeowners have no savings to cover their living expenses if they lose their job, according to a survey by Wells Fargo & Co.

The quarterly survey discovered that to cut costs, homeowners are taking extreme actions; 34 percent say they have had family members or friends move in with them in the past year.

It also says 42 percent of the respondents are spending less on their children in the weak economy.

Of those who have debt other than a mortgage, 43 percent say they think about their debt every day. And 24 percent think about it at least once a week.

Because of their debt, 36 percent say they’re cutting back on expenditures such as dining out and buying clothes.

Interesting information. Notice that those cutting back are due to debt. We wonder if you added the number of people who are cutting back out of fear for their jobs - probably brings that 36% up significantly higher. Then add in the number of people who have had their credit cut and just do not have the means to have additional expenditures. Since we all know that there are many who will spend that credit regardless of the debt piled up.

Neither the money nor the incentive to spend it there. And it looks like neither one will be there for some time to come.

1 comment:

Anonymous said...

Stupid homedebtors learning the haard way. Do not work just to pay the bills . How about saving asome money first? Oh you can;t becqasue you paid to much for your bloated McDebtshack.
NY -NJ are sinking into the abyss. The metro area is going to be slammed hard.