Could you imagine going from making a six-figure salary to almost homeless? Well that’s what happened to Elizabeth White. I was both saddened and enlightened by her PBS NewsHour interview, which highlights the topic of financial fragility.
The National Endowment for Financial Education (NEFE) conducted a study and concluded that too many Americans are living on the edge of financial fragility (inability to cover unexpected expenses). Among other key findings, it was discovered that more than 36% of working adults could not come up with $2000 in 30 days. Furthermore, almost 30% of middle-income households and 20% of those with income in the $75,000-$100,000 range are financially fragile.
Elizabeth White’s story and the results of the NEFE study reemphasizes the importance of making savings and investing for the future a top priority.
Oftentimes, we get so wrapped up in our daily routines, that it’s hard to conceptualize all the changes occurring in the world around us. One such change, being our earning potential. Let’s face it, in today’s economy, if you’re fortunate enough to not get laid off, you’ll probably hit your income peak (excluding side hustles) at around 40-50 years of age.
If you know that you would not be able to cover an unexpected expense (without borrowing), make a commitment to start building your emergency savings today. Also, come up with a plan to eliminate your debt sooner than later. Share this post with friends and family and encourage them to do the same.
We have fire drills, tornado drills, and even active shooter drills. Let’s take this time to sound the alarm on financial fragility.
“Beware of little expenses; a small leak will sink a great ship.” – Benjamin Franklin
