​The tattered state of Americans' emergency funds

Brooklyn Grey was already struggling to cope with rent increases on her Los Angeles apartment when things went from bad to worse.

The performer and writer had a dispute with her landlord, which forced her to leave her apartment. She says her landlord refused to refund her full security deposit, which left her in a financial hole.

"The Los Angeles housing market is very bad," she said. "I spent a good year and half looking for an apartment. A lot of owners wouldn't get back to me, or they wanted too much money."

After failing to find a place to live, she decided to move back to New York City, where she grew up. Grey estimated the move cost at least $2,000, and has left her scrambling to pay for food and temporary lodgings while she looks for an apartment. As someone who works in the "gig economy," having worked as both a makeup artist and a singer, her income can swing from month to month, although she noted that she's helped by her monthly Social Security disability payment of about $890 per month, which aids in covering basic expenses.

"For people who work paycheck to paycheck, it's becoming harder to live and have breathable space to save for the next month," Grey, 32, said. "I tried to save money for years in Los Angeles. I never could. There would always be an emergency."

While it might seem that Grey was simply unlucky to hit on tough times, her experiences are increasingly shared by other Americans, thanks to an economy that's left more households dependent on stagnant wages or incomes that can be volatile from month to month. In fact, one in three American families have no savings at all, according to new research from The Pew Charitable Trusts. The lack of a financial cushion even extends to well-off households, with 10 percent of households with more than $100,000 in annual income saying they have nothing tucked away for emergencies.

The low level of savings "suggests that many families are one financial shock away from being destabilized," said Clinton Key, a researcher for Pew's financial security and mobility project, on a conference call to discuss the results.

The study, which is the second in a three-part research study into American household finances from Pew, is based on responses from more than 7,800 respondents. Its first study found that the financial "balance sheets" of American families were under stress, with about seven out of 10 Americans strained by problems ranging from debt loads to income that wasn't high enough to cover their expenses.

Interestingly, when Pew researchers asked respondents how much they believe people should have socked away for emergencies, most recommended six months of savings. In reality, Americans have far less than that.

That gap between what Americans believed they should have saved and their actual paltry savings "was a big surprise," Key said. "The median gap was over $9,000. It shows the status quo just isn't working for families."

Forty-one percent of households didn't have enough liquid savings to cover a $2,000 financial shock, Pew said. Poorer households were worse off, with Americans earning less than $25,000 in annual income saying they only had enough savings to cover six days of household income. By comparison, households with $85,000 in annual income said they had enough socked away to replace 40 days of income.

The problem is that financial shocks, while not predictable, are often inevitable: the car breaks down, or a family member ends up with high medical expenses, or a partner loses her job. Without a cushion at hand, such an emergency can send a household into a financial free-fall. As for Grey, she's turned to Gofundme to ask friends for financial help to build her emergency fund. She said she's not optimistic she'll be able to raise the $1,600 she needs.

"At the end of the day, it's very discouraging and very hard on the heart and soul," she added.

"No one expects to have a financial shock happen to them today, but they are common," Pew's Key noted.

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