Anyone who’s experienced the feeling of being unprepared for an emergency would probably agree the best time to start saving for a crisis is yesterday.
Nobody likes to be caught off-guard — especially financially — which might be why 63% of Americans say they’re happy with their plans for the next emergency, according to a newly released survey from credit and identity security firm ScoreSense.
Although being happy with an emergency plan will not necessarily mean each respondent is completely prepared, it’s a great first step.
63% of Americans are happy with their emergency plans
Despite a year of economic volatility and seemingly endless surprises, close to two-thirds of consumers surveyed felt comfortable with their plans and ability to address the next crisis, whenever it arrives.
Still, ScoreSense also found that 26% of consumers didn’t have an emergency financial plan in place at all.
Unfortunately, many of those without a plan in place might be in that situation because their current financial situation is especially dire. The survey found that nearly half of those respondents making $25,000 or less were among those without an emergency plan.
On the other hand, a 59% majority of those surveyed were expecting to increase their savings in order to prepare for the future.
Pandemic recovery stifles savings
Although many consumers plan to replenish savings accounts, the survey also found that over a quarter of those who lost employment during the COVID-19 pandemic are in fact living off their savings.
Even as the end of the pandemic inches closer and closer, those who were hit the hardest will likely continue struggling to recoup those losses for some time after.
The good news is that a majority of respondents weren’t adding new debt — whether through new credit cards, personal loans or other means — despite the financial stress they face. The proportion of those taking on additional debt varied by age, but even among millennials (the most likely group to borrow), 66% hadn’t applied for any new debt during the pandemic.
As for types of debt taken during emergencies, Gen Z and millennials were the most likely to add a new credit card to help in a pinch (19% and 21%, respectively). In addition, these two groups were also most likely to start a side hustle in order to make ends meet (39% and 22%, respectively).
Emergency preparedness gender gap
ScoreSense researchers found interesting correlations between gender and emergency savings, with men reporting a bit more confidence in both the overall economy’s recovery and their personal preparedness.
The survey found women were nearly twice as likely as men to be dissatisfied with their current emergency plan (21% vs. 11%). This isn’t too surprising, given the gender pay inequality that persists in the U.S. — which has been exacerbated by the well-documented and disproportionate job losses women have faced throughout the pandemic.
Looking to the future, many consumers are doing their best to plan for the unexpected. And at least some of the current attitude toward preparedness, ScoreSense’s research noted, is a result of the global pandemic, which has remade the environment for many facets of life, from healthcare to retirement.
Methodology: Consumer research company PeopleFish conducted this survey on behalf of ScoreSense. PeopleFish surveyed 1,080 U.S.-based consumers age 18 and older in June 2020.