Consumers Aren’t Great Savers: CFPB Report

Even rich people are having problems paying their bills, according to a new report released by the Consumer Financial Protection Bureau. Looking at data that from a previously conducted survey, researchers at the CFPB concluded that 40% of all individuals had difficulty paying a bill or covering an expense in the preceding 12 months.

While the percentage of people who had trouble paying a bill was higher in groups where the annual income was lower, the issue was prevalent in all income brackets. For example, 62.4% of individuals making less than $20,000 a year had trouble paying a bill, but so did 31% of individual who were making between $70,000 and $100,000 a year, and 18% of individuals who earned at least $100,000.

One data point that is probably less surprising is that people who identify themselves as “savers” are less likely to have trouble playing bills than individuals who consider themselves to be “non-savers.” More than half of individuals who make more than $70,000 a year, but consider themselves to be non-savers had problems paying bills, compared to 24% of individuals who say they are savers.

In what might be described as a situation of circumstance, the report also found that individuals who have less than they think they need in their bank accounts to cover an unexpected expense are less likely to save than those who think they have as much or more than they think they need. Overall, 51% of individuals who claim to have less than they need are saving, compared with 88% of those who think they have as much as they need.

“The notion that not saving may be a key factor in consumers’ difficulty making ends meet, especially when financial emergencies arise, is particularly significant in light of the finding that about two-thirds of survey respondents report experiencing a significant shock in the past year,” the report concludes.

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