Most people in Milwaukee have heard financial experts say that it's important to have an emergency fund. After the Great Recession, though, it appears that more and more people are lagging in that area of their finances. In fact, the results of a poll by Bankrate.com found that just slightly over half of Americans have put aside more money for an emergency than they have in overall credit card debt.
Seventeen percent have no credit card debt but also have no emergency fund. Twenty-eight percent say that their credit card debt is more than their emergency fund.
A teacher at Utah Valley University says that he believes having insurance coverage is more important than an emergency fund. He believes that insurance will protect against big losses, whereas an emergency fund of $3,000 will only go so far.
Not everyone agrees with this line of thinking, though. According to Bankrate.com's chief financial analyst, the fact that some people use their credit cards for funding emergency situations "is a problem." The analyst says that putting money into an emergency fund is a much better idea, because the credit cards have such high interest rates.
Americans are saving less than they should be, according to the results of the above-mentioned poll. Most people do realize the importance of having an emergency fund; however, the slowly recovering economy, unemployment and stalled income have made it difficult for many Americans to save.
While the economy continues to slowly improve, there are many who are still experiencing high credit card debt. If you find yourself in this situation, you may benefit from the advice of a Wisconsin bankruptcy attorney. He or she can provide more information about your options for finding financial freedom.
Source: Desert News National, "Is credit card debt the new emergency fund?" Michael De Groote, Feb. 28, 2014