Americans felt slightly better about their financial lives last year as measured against the year before, but as noted in a Federal Reserve study released last week, adults with no college education “lost ground,” as noted by The Wall Street Journal for the first time in four years.
The numbers show that 70 percent of more than 6,600 respondents surveyed by the Fed in October 2016 for the “Survey of Household Economics and Decisionmaking” said they felt they were “living comfortably” or “doing OK” as compared to 69 percent in 2015, with that tally at 62 percent in the first survey conducted in 2013.
Conversely, only 60 percent of the respondents who had attained a high school diploma as their highest level of education said they’d felt similar security, down from 61 percent in 2015. The Fed found that education levels may show to be a determining factor in the sense of financial security as 82 percent of adults with at least a bachelor’s degree were similarly self-described as “living comfortably” or “doing OK” compared with 80 percent before, while those with some level of college education, including associate degree, said they’d felt comfort levels grow to 69 percent from 66 percent previously.
The slight boosts to perceived financial stability occur against a backdrop of average unemployment levels in the United States of around five percent last year.
Despite those overall sanguine feelings, the day to day financial existence is one that is a bit shaky for most Americans, as the survey found that 44 percent of respondents said they would have difficulty covering an unplanned $400 expense such as a car repair, and would have to borrow money or even sell items to cover that cost. The educational divide becomes stark here, as 79 percent of those with at least a bachelor’s degree are able to pay off all their bills even with the $400 charge. That tally drops down to 52 percent for those with only a high school diploma. Overall, the share of adults that would find it rough sledding to come up with $400 in an emergency has come down by six percentage points in the last four years, indicating at least some financial strengthening.
Drilling down a bit into the expenses, out of pocket medical bills are among the heaviest burdens, with a median of $1,000 charged for unexpected medical events. And 24 million adults are in debt from those events as measured over the past year. Separately, 28 percent of adults who have yet to retire said that they have no retirement savings in place at all.