■ Only 48% of Americans say they could handle a $1,000 emergency expense using cash or savings in their bank accounts. Still, tapping savings was the most common strategy for handling an emergency, followed by borrowing from friends or family.
■ Six in 10 Americans have had an emergency in the past year that cost them $1,000 or more.
■ One-third of Americans are currently in debt from an emergency expense they couldn’t cover.
■ Of Americans who had to go into debt to cover a past emergency, a third still owe $5,000 or more for this expense and about 18% have emergency debt balances of $10,000 or more.
The Lending Tree report states that based upon its survey, “When faced with an emergency expense, tapping savings to pay for it in cash is the most popular strategy. Even so, less than half (48%) of Americans would be able to cover an emergency of $1,000 or more out of savings.”
The report stated that the majority of Americans would have to turn to other options to pay for an emergency:
16% would borrow from family or friends
9% would sell something
9% would use a credit card
7% would work more
6% would get a loan or paycheck advance
Another interesting finding was that 60% of our respondents said they had encountered an emergency that cost them $1,000 or more in the past year. And 17% had three or more such emergencies crop up over the past 12 months.
And 33% of respondents say they are still in debt from borrowing money to pay for a previous $1,000-plus emergency, and of Americans with debt from a past emergency, 33% still owe $5,000 or more, including 18% whose outstanding balances are $10,000 or more.