As a personal finance blogger, I try to do as much research as I can before I publish a blog post so that I can see the full picture.
However, whenever I research different financial topics I usually come across some scary money statistics.
The money stats you read in this post might scare you, but hopefully they can help you so that you can improve your finances and be better than the “average” person.
Even if you are doing better than the average person, that definitely does not mean that you are doing well financially either though.
You should always strive to do your best as sometimes “average” is not good enough for you to live a financially successful life.
Below are some scary money statistics that will hopefully whip you into financial shape. Enjoy!
1. 68% live paycheck to paycheck.
According to survey done by CNN, 68% of Americans surveyed live paycheck to paycheck. According to their survey, these households have less than $800 to cover them until their next paycheck.
If you are living paycheck to paycheck, I suggest trying to find a way to get out of this bad situation immediately. Having money set aside and a buffer can greatly help you in times when you need it.
Related articles:
- How To Live On One Income
- 10 Ways To Make Money Online From The Comfort of Your Home
- 10 Things I’ve Done To Make Extra Money
- Ways To Make An Extra $1,000 A Month
2. 26% have no emergency savings.
According to a survey by Bankrate, 26% of survey takers had no emergency savings whatsoever and 24% had less than three months worth.
What I was happy to read though was that 23% had 6 months or more in their emergency fund, which is actually a much higher percentage than what I thought it would be.
How much a person needs in their emergency fund can vary greatly, but I tend to think that 6 months of expenses or more is a good number. I like to be comfortable, but that number can vary, especially if you have high interest rate debt that you are trying to pay off or if you have unstable income.
Related article: Everything You Need To Know About Emergency Funds.
3. The median amount saved for retirement is less than $60,000.
According to the Federal Reserve, the average person is not saving for retirement.
The $60,000 amount above only counts people who are actually saving for retirement, and that is for all age groups. $60,000 won’t get you far so this is a very alarming statistic.
The median value of retirement accounts for families who are saving for retirement is $12,000 for households with members younger than 35, $42,700 for households with members between the ages of 35 to 44, and it goes slightly up from there, but for households with members older than 75, the amount saved is just $69,500.
Keep in mind that these statistics only count people who have actually saved anything for retirement.
According to US News, 45% of households do not have anything saved for retirement. This means that once you account for these households, the numbers above decrease dramatically.
Related article: Why You Should Invest and Save For Retirement – Plus a Personal Finance Confession Fail.
4. The average household has $7,283 in credit card debt.
According to NerdWallet, the average household has $7,283 in credit card debt. However, if you only count households that have credit card debt in the first place, that number jumps to $15,611.
Also, consumers in the U.S. have nearly $883 BILLION in credit card debt.
That is a lot of credit card debt. Credit card debt can be due to many different reasons including living paycheck to paycheck, emotional spending, and more.
Related article: How To Eliminate Your Debt.
5. The average student loan debt is $32,264.
Also according to NerdWallet, the average student loan debt is $32,264 and consumers in the U.S. have nearly $1.13 trillion altogether in student loan debt.
Also, according to the Federal Reserve Bank Of New York, $323 billion of student loan debt is held by those who are 40 years old and older. That is nearly a third of student loan debt.
This is a ton of money. I had almost $40,000 in student loan debt when I graduated and I still believe that a lot of that had to do with me thinking that this was “average” and that if everyone else had the same amount of student loan debt as me that it wasn’t that big of a deal.
Boy, was I wrong. When I received my first student loan bill after I graduated, I knew I wanted to pay off my debt quickly because having such a huge amount lingering over my head gave me a headache.
Related articles:
- How I Graduated From College In 2.5 Years With 2 Degrees AND Saved $37,500
- My Student Loans are GONE
- 6 Ways I Saved Money On College Costs
- Should I Ruin My Retirement By Helping My Child Through College?
Did anything in this post surprise you? How do you compare?
Related Posts
How My 401k Loan Cost Me $1 Million Dollars- How I Repaid $65,000 In Student Loans and Invested at the Same Time
- You CAN Reach Retirement! Avoid These Top 5 Retirement Mistakes
- Here’s What I Learned From Working For Millionaires
- 20 Ways I Saved a 20% Deposit To Purchase My First Investment Property At 20
- Are You Better Than Average?
Jayson @ Monster Piggy Bank says
Honestly, I am afraid for those people who don’t have an emergency fund. Knowing that there’s 26%, like 2 out of 10, is shocking. They should think twice and learn from others’ experience who had it firsthand. And, it’s better to be ready than not.
Michelle Schroeder-Gardner says
Yes, I am afraid for them as well! Back when we didn’t have an emergency fund, it seemed like everything went wrong ALL the time and we were always stressed out about all of those unexpected expenses.
Kimsea Sok says
Thanks for sharing the information….
I think that your readers may not scare with the statistic information which you’ve written above article unless they faced with themselves.
Honestly, the first I became a jobless I got only 700 dollars in my pocket. You know..? I started to know about how it is hard to live without money. You feel like you’re going to sick, but you told yourself that you cannot.
You have no money, and no insurance. Life is nothing guarantee to make it better.
Actually, it was a scare amount to me..
Thanks for sharing the information..
Michelle Schroeder-Gardner says
Yes, sometimes a person just need to face the situation themselves, however, sometimes it may be too late to fix the damage!
Brian @DebtDiscipline says
Scary to think so many people are still not on track with their money. It really shows how important financial literacy is. Our school system need to do a better job promoting it at a young age preparing our children for their futures lives with money.
Michelle Schroeder-Gardner says
Yes, I definitely think schools need to start being more active. I didn’t take a single personal finance related course in high school and I believe that should be required.
Bob Wilson says
The system is by product of the overall system of “Capitalism”, which is built on having an under class of misinformed citizenry that is taught to fed the beast of CAPITALISM by any means necessary!
If get educated they will learn about how the system really works and the “Power that be do not want that!” The method to control the masses is to keep them misinformed and divided, so they will fight amongst themselves for the garbage of minimum wages and process food that creates all types of diseases to weaken the citizenry into submission!!
Melody says
You need to read the book called” Basic Economy” by Thomas Sewell. It will show you why Capitalism works and what can be done to make the economy better..
Utopia cannot be achieved when it comes to money structures! Communism and shared wealth is not a good way to run a country! I lived in China for two years so I saw first hand how these types of countries are run. It does NOT make people equal. The leaders are very wealthy and there are many very poor people in China. The health care is terrible for those with chronic illnesses.
Badger says
The people living paycheck to paycheck already spending as little as possible.
Financial Literacy won’t help you if your job doesn’t pay a living wage. If you can’t afford a $900 one bedroom apartment, it’s not like can you just move into $700 one bedroom apartment. Those don’t exist.
It’s not like people making $10 an hour are going to Disneyland.
Amy @ DebtGal says
While these numbers don’t surprise me, they certainly are scary. Living paycheck to paycheck is terrifying, and I sincerely hope to never go through that again!
Michelle Schroeder-Gardner says
Yes, the statistics above are scary!
Ameerah@ Valiantly Varnished says
I have to say I’m not surprised by these numbers at all. The truth is living paycheck to paycheck is a reality for a lot of people simply because they can’t afford to save. If you don’t make a living wage to begin with saving is a luxury.
Michelle Schroeder-Gardner says
I’m not super surprised by the stats above, but they are sad.
Barry @ Moneywehave says
Canadian statistics aren’t much better. Our debt-to-income ratio is sitting at 163.3%, housing costs are at all time highs, although credit card debt is down, payday loans are up. These numbers are indeed shocking.
Michelle Schroeder-Gardner says
That’s sad and scary that payday loans are up!
Stephanie says
Those are some scary stats. So happy to not be in those percentages.
Michelle Schroeder-Gardner says
Good job!
MarieMakesCents says
I’m guessing that a lot of the 45% of households who have no retirement savings are relying on pensions to sustain them. I know a lot of teachers who have the mentality that they don’t need to save because they’re going to keep pulling a pension paycheck. This scares me because of the shakiness of pensions in recent years.
Michelle Schroeder-Gardner says
Yes, I agree! That is too risky for me.
Chonce says
The statistic that always freaks me out is the amount of debt American households carry. Living paycheck to paycheck is also extremely common, but not real way to live in my opinion. It’s takes time and dedication to save up a solid cash buffer but it’s worth it.
Michelle Schroeder-Gardner says
Yes, I agree! Well worth it.
Emily @ evolvingPF says
This would have been a great Halloween post! So scary!
I was surprised to see that my household already has more saved for retirement than the medians of all the age groups you mentioned. And we’re still in our 20s. And we’ve NEVER had proper jobs (been in school/training the whole time). It goes to show how just paying a bit of attention and trying a little can put you so ahead of the curve.
Michelle Schroeder-Gardner says
Haha yes, this would have been perfect for Halloween 🙂
kammi says
I’m not surprised. I went to the bank this weekend to deposit and withdraw money at an ATM near me, and saw two different receipt slips; both were from people who had withdrawn money (small sums, too) and were left with a balance of just three dollars. Insane because in my country of birth, we’re in the middle of a boom and a lot of people are making money and we have a comfortable middle class, with people still able to buy houses and have a decent lifestyle(plus tertiary education is free). This is becoming harder to accomplish in the US for certain people, particularly in our younger generation.
I’ve definitely noticed in the US it’s becoming a society whereby you either have the skillset (or connections) and can make a lot of money(it’s up to you what you save after that) or you don’t and you struggle, and it is not just sector-dependent, but location-dependent. You can still pick up and go into a field and make a lot of money, but if you don’t figure it out (don’t go into student loan debt, buy land, etc) and make some wrong decisions, you can be set back for a number of years (well into your 40s and even 50s/60s) and be wiped out by the simplest of ailments and have NO savings. I definitely (since I’ve been in the US) have seen a widening pool of poverty in some areas, while reading online about massive amounts of real estate being bought in cash simultaneously. Interesting stuff!
Michelle Schroeder-Gardner says
That is sad and scary about the ATM slip. I hope they didn’t pay any ATM fees to take out those small amounts.
Fervent Finance says
It doesn’t surprise me. We have no formal financial education in school. People are expected to figure it out on their own, maybe from their parents. Well if their parents are the ones racking up debt and living paycheck to paycheck, are these the right people who are supposed to teach us?
I think a mandatory course in high school (maybe junior or senior year) should be intro to finance. It will not contain any “how to” information, but will explain what a credit card is, what a 401k is, what health insurance is, etc. This would definitely fix those statistics above!
Michelle Schroeder-Gardner says
Yes, I agree!
ReTully says
Another thought on the Emergency fund, is I know people who have a lot of savings, but also a lot of consumer debt at the same time, which if they lost their jobs, they would be as bad off as the people with no emergency fund because all their savings would go to pay off debt. Pay off your consumer debt friends and then beef up the emergency fund, then you will have true peace of mind when an emergency does happen 🙂
Michelle Schroeder-Gardner says
Yes, definitely! Especially so if you are paying high interest rates on your debt.
Michelle Schroeder-Gardner says
Thanks Elise!
Sarah says
I’m not surprised by these numbers, but they are scary. It’s a good reminder to keep chugging along and prepare for the future. I know way too many that fit into many of these categories.
Michelle Schroeder-Gardner says
Same here 🙁
Dawn says
I am surprised by how many my age(41) still have student loans. Makes me feel less lonely but also sad for my age class. It is such a heavy weight that needs to be lifted. But colleagues of mine that I talk with about this have an attitude of this is normal. It sucks and shouldn’t be normal! So I am weird and trying to pay off faster. They are taking vacation and I take the PTO pay out to pay down debt. Hard to watch them as i want to take a cruise or go to the Caribbean as well 🙁
Michelle Schroeder-Gardner says
Yes, it’s a heavy weight that NEEDS to be lifted!
Mrs. Frugalwoods says
The living paycheck-to-paycheck thing always scares me the most. That’s just such a thin margin to skate and you’re really banking on 1) never losing your job, and 2) no unexpected emergencies or expenses. Way too risky for my tastes! Plus, it seems like it’d be impossible to truly plan for the future if you’re spending everything you earn. Eek!
Michelle Schroeder-Gardner says
I agree!
Christine Berry - Wealth Way Online says
Wow, that’s a little scary actually. Funny, my student loan was almost bang on for this article $31,000. I’ve already made a $8,000 payment in April and will be due to make another $10,000 or so soon. I’m excited about getting it gone, but trying to strike a balance between building up my emergency fund, starting to invest and getting rid of it.
It must be a good feeling to have no debt! I can’t remember what it’s like. I’ve had my loan since I was 17!
Michelle Schroeder-Gardner says
Pay it off soon! 🙂
Stephanie Hattaway says
I love this post. As a single mom I am always trying to find ways to earn extra cash. This year seems to be particularly challenging and I am trying to pay down student loan debt while our cost of living continues to soar. Needless to say… I am struggling. Thank you for the links and suggestions.
Michelle Schroeder-Gardner says
Welcome Stephanie 🙂
JC says
Man, this is unbelievable. What’s most concerning for me is that number of people who haven’t saved for retirement. What happens when they start drawing on government programs to survive? I’m in my 20’s and I already have double what your statistics say for someone my age saved for retirement and that doesn’t count the money in my fiances retirement accounts either. I have to admit that seeing our friends with numerous vacations, fancy cars and stuff is hard, but I know that when we get a bit older we are going to have so many more oppertunities than they will. It’s astonishing to me that people don’t worry about what their life will look like in the future.
Michelle Schroeder-Gardner says
I agree! More people need to start caring about the future.
Laura Harris says
This is the blog post I wanted to write – but you did it much better! Thank you. Statistics were always a powerful wake up call for me. Thank you for gathering this research. I will spread the word!
Michelle Schroeder-Gardner says
Thanks Laura!
Kayla @ Shoeaholicnomore says
These are some scary stats! I’m glad to know that I’m better than the average in almost every category you mentioned. But that doesn’t mean I’m going to slack off and quit trying to get out of debt and increase my savings.
Michelle Schroeder-Gardner says
Yes, definitely!
Jason B says
I can believe all those stats. I’m shocked that the median for retirement is less than $60K. Keeping up with the Joneses is screwing people over big time.
Michelle Schroeder-Gardner says
I agree!
Jessica says
Yikes! These are some crazy statistics and I’m not sure what scares me the most. Personally, the only one that applies to me is the student loan debt. I’m just now down to the average after paying off just over $50,000. I can’t wait to pay off the rest!
Michelle Schroeder-Gardner says
I hope you can do that soon! I’m sure you will be able to.
Alexis says
Those are scary statistics! At the same time, I know a lot of individuals my age in that boat (25-30). The student loan debt one for those over 40 surprises me, but it makes sense as more people are going back to school at later ages to get their first degree or go to grad school.
Michelle Schroeder-Gardner says
Yes, very scary!
Natalie @ Financegirl says
All of these are shocking to me except for the student loan debt. Add a 1 in from of that $32k and that’s where I’m at!!!
Michelle Schroeder-Gardner says
Yeah, I was a little surprised that the student loan debt wasn’t higher.
jackie says
yeah not surprised either. We are working on paying off our debt too so we can save more too!
Michelle Schroeder-Gardner says
Awesome!
Sherry Tingley says
I have a blog about personal finance too and find that stats seem to change frequently. It is interesting that you have a variety of sources you are quoting. I think everyone can try to do better with their financial decision making. One of the hardest things to admit to yourself is that the income you currently have isn’t enough and that you should be considering starting a business of your own. The earning potential is greatly enhanced when you own your own business. Thanks for the tips.
Michelle Schroeder-Gardner says
Thanks Sherry!
Debt Hater says
At first when I read the retirement statistic I figured it was just skewed because of younger workers not having much saved and really bringing down the average/median. But it doesn’t seem to get much better from there! And then there’s the fact that 45% have nothing saved. That’s mind boggling to me and somewhat scary.
Michelle Schroeder-Gardner says
Yes, very scary!
Michelle Schroeder-Gardner says
Definitely!