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Could You Raise $2,000 in a Pinch?
Ricedelman.com ^ | September 2011 | Ric Edelman

Posted on 07/28/2013 9:04:15 AM PDT by Kip Russell

Or would you feel pinched?

If your roof sprung a leak or your dentist said you needed a crown, would you be able to write a check to cover such an emergency?

Either might cost $2,000, but about half of Americans say they couldn’t come up with that much cash within 30 days.

That’s according to a paper published by the National Bureau of Economic Research, using data from the 2009 TNS Global Economic Crisis survey aimed at showing the extent of financial weakness in the U.S. and other nations.

The survey asked, “If you were to face a $2,000 unexpected expense in the next month, how would you get the funds you need?” As reported in the Wall Street Journal, only 25% of American respondents said they could gather that much money in a month, while another 25% said they were “probably” able and 28% said they were “certainly unable” to do so.

The $2,000 figure “reflects the order of magnitude of the cost of an unanticipated major car repair, a large copayment on a medical expense, legal expenses or a home repair,” the authors wrote. Specifically, they chose $2,000 as the probable cost of replacing your car’s transmission.

Most respondents said they’d cope by dipping into savings, borrowing from family and friends, using credit cards, seeking payday loans, pawning their belongings or selling some possessions. “Taken together with those who would sell their homes,” the authors said, nearly half of all respondents “are living very close to the financial edge.”

If half of Americans can’t come up with two grand in an emergency, imagine their reaction to our advice that you maintain as much as two years’ worth of spending in cash reserves. For most Americans, $2,000 wouldn’t even cover costs for much more than a month.

To find out how much you should have in your emergency fund, talk with a financial planner.


TOPICS: Business/Economy; Education; Society
KEYWORDS: emergencyfunds; savings; twothousand
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I could with no problem whatsoever...but apparently there are a lot of people who can't.
1 posted on 07/28/2013 9:04:15 AM PDT by Kip Russell
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To: stylecouncilor

I bet you could :)


2 posted on 07/28/2013 9:06:25 AM PDT by windcliff
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To: Kip Russell
Either might cost $2,000, but about half of Americans say they couldn’t come up with that much cash within 30 days.

When half of Americans are on the Government dole, that is to be expected.

3 posted on 07/28/2013 9:08:07 AM PDT by SampleMan (Feral Humans are the refuse of socialism.)
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To: Kip Russell

I can, but I know a whole lot of people who would be hard pressed to come up with half of that.


4 posted on 07/28/2013 9:09:38 AM PDT by GenXteacher (You have chosen dishonor to avoid war; you shall have war also.)
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To: SampleMan
When half of Americans are on the Government dole, that is to be expected.

Exactly so. They're supported by The State, so why should they have savings? If something goes wrong, it's the responsibility of someone else to pay for it.

5 posted on 07/28/2013 9:10:17 AM PDT by Kip Russell (Be wary of strong drink. It can make you shoot at tax collectors -- and miss. ---Robert A. Heinlein)
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To: Kip Russell

Not a problem here either.My in-laws however........


6 posted on 07/28/2013 9:11:00 AM PDT by Farmer Dean (stop worrying about what they want to do to you,start thinking about what you want to do to them)
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To: Kip Russell

Can you front me a $20 spot?


7 posted on 07/28/2013 9:13:09 AM PDT by mylife (Ted Cruz understands the law, and he does not fear the unlawful.)
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To: Kip Russell
Apparently, Obama can raise 200,000,000 in a pinch and give it to terrorists.
OH! WAIT!
He didn't raise it.
He looted it.
8 posted on 07/28/2013 9:15:12 AM PDT by RandallFlagg (IRS = Internal Revenge Service)
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To: windcliff

I has $2000 ,but don’t tell the wife


9 posted on 07/28/2013 9:15:35 AM PDT by molson209
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To: SampleMan
"When half of Americans are on the Government dole, that is to be expected."

Bingo! The government teaches dependence. Why should an Obama drone save? As far as the article comment, that people should have as much as two years expenses saved, few could meet that standard.

10 posted on 07/28/2013 9:16:25 AM PDT by Truth29
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To: Kip Russell
"Most respondents said they’d cope by dipping into savings..."

Most emergency funds are savings, aren't they? Or does he mean retirement savings?

11 posted on 07/28/2013 9:16:27 AM PDT by ConjunctionJunction
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To: Kip Russell

75% of Americans need to read a Dave Ramsey book.


12 posted on 07/28/2013 9:16:38 AM PDT by Red Dog #1
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To: Kip Russell

Was this always the case? Could Americans in 1955 raise a proportional amount? Or did we not even ask the question, because it wasn’t the public’ business to know?


13 posted on 07/28/2013 9:17:10 AM PDT by PGR88
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To: Kip Russell
"Dig Your Well Before You're Thirsty: The Only Networking Book You'll Ever Need" - Harvey Mackay
14 posted on 07/28/2013 9:17:20 AM PDT by MV=PY (The Magic Question: Who's paying for it)
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To: Kip Russell
The author says that people would "cope by dipping into savings"???

That's the whole reason you have savings in the first place. Why is this a "coping" mechanism? It's the raison d' etre for saving money in the first place. It's stupid to say people can't raise $2,000 unless they cope by dipping into savings.

If you're able to save money, be sure to save for different needs: long-term (kids' college, retirement), intermediate-term (house down payment, car down payment), and short-term (roof leaks, crowns on your teeth, back-to-school expenses, layoffs from work).

15 posted on 07/28/2013 9:18:17 AM PDT by ProtectOurFreedom
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To: Kip Russell

Most respondents said they’d cope by dipping into savings,...ANNNND why do you have savings, if not for emergencies? I dip into mine when I want to go deep sea fishing. This January I will dip into my IRA to go deep sea fishing in Hawaii. What is the problem? If I wait longer, I might have a heart attack, stroke or lung cancer. Why not spend it now, while I’m able? Sheesh these people are stupid.


16 posted on 07/28/2013 9:19:56 AM PDT by Safetgiver ( Islam makes barbarism look genteel.)
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To: Red Dog #1

Dave Ramsey rocks!


17 posted on 07/28/2013 9:20:54 AM PDT by mylife (Ted Cruz understands the law, and he does not fear the unlawful.)
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To: Kip Russell

There is not much incentive to save money these days, with interest rates so low. But people neglect to recognize how expensive it can be to borrow money.


18 posted on 07/28/2013 9:21:05 AM PDT by smokingfrog ( ==> sleep with one eye open (<o> ---)
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To: Kip Russell

The first thing any responsible person should do, regardless of how little money they may be making, is to save some money for emergencies.

Right after paying rent and utilities, the next highest priority should be putting some money aside, THEN figure out how you live on what’s left and what are your real NECESSITIES — and figure out if there is any extra work you can do for a little extra money.


19 posted on 07/28/2013 9:23:13 AM PDT by Innovative ("Winning isn't everything, it's the only thing." -- Vince Lombardi)
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To: Kip Russell
I was able to before the economy started 'improving'.

/johnny

20 posted on 07/28/2013 9:23:38 AM PDT by JRandomFreeper (Gone Galt)
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To: Safetgiver
This January I will dip into my IRA to go deep sea fishing in Hawaii. What is the problem? If I wait longer, I might have a heart attack, stroke or lung cancer. Why not spend it now, while I’m able?

I dipped into my savings this year to go to Iceland, and in just 2 weeks I'm taking my father on a safari in South Africa. I save, but I'm not a fanatic about it.

21 posted on 07/28/2013 9:24:05 AM PDT by Kip Russell (Be wary of strong drink. It can make you shoot at tax collectors -- and miss. ---Robert A. Heinlein)
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To: Kip Russell
about half of Americans say they couldn’t come up with that much cash within 30 days.

As Solomon put it, "The borrower is slave to the lender." These slaves can't come up with $2000 because they're working to pay off their homes, cars, etc. - plus buying a few extra to give to their masters.

This is known as "interest".

But not to worry: If they need $2000 worth of dental work, they'll just borrow it from their master. They can then work to pay it back - plus pay for all his family's dental work.
22 posted on 07/28/2013 9:24:27 AM PDT by LearsFool ("Thou shouldst not have been old, till thou hadst been wise.")
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To: Kip Russell

That’s why I bought gold and silver so many moons ago. It’s not immediately liquid, but it’s liquid enough.


23 posted on 07/28/2013 9:26:26 AM PDT by Ancient Man
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To: Safetgiver
You know what cracks me up?

Those commercials about retirement savings. Where everyone is dancing to Tequila, sky diving and surfing LOL

Have your fun now, but save some money to pay for some one to wipe your ass.

24 posted on 07/28/2013 9:26:58 AM PDT by mylife (Ted Cruz understands the law, and he does not fear the unlawful.)
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To: SampleMan

Just goes and get some Obama money! From his stash!


25 posted on 07/28/2013 9:27:27 AM PDT by wny
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To: JRandomFreeper

Obama stole 2k from me with the payroll tax!


26 posted on 07/28/2013 9:27:55 AM PDT by mylife (Ted Cruz understands the law, and he does not fear the unlawful.)
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To: Ancient Man
That’s why I bought gold and silver so many moons ago. It’s not immediately liquid, but it’s liquid enough.

I should have done the same before they went through the roof. I have some gold and silver, but I wish I had more.

27 posted on 07/28/2013 9:28:10 AM PDT by Kip Russell (Be wary of strong drink. It can make you shoot at tax collectors -- and miss. ---Robert A. Heinlein)
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To: Kip Russell

There is a young guy with wife and child at my place of employment, I’ve been trying to quietly coach him into a more stable financial existence. I’ve hit a brick wall with overdraft protection on a checking account. He views it as an emergency loan and I can’t get him off it. This guy is one of the ones who is actuallytrying to better himself, an increasing rarity. The stupid runs deep regarding financial matters among the young, and it’s pretty bad even among those close to my age. Not that bad, but pretty bad.


28 posted on 07/28/2013 9:29:25 AM PDT by RegulatorCountry
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To: Kip Russell

but I’m not a fanatic about it...I used to be but I visited my Dad’s grave last month and saw he died ten years from my age. I truly sat and thought “I gots no kids, no family, I don’t want the government to grab what I DO have so why am I being monetarily conservative?” Ya know, I’m spending the crap I’ve got now and ...who gives a shiite?


29 posted on 07/28/2013 9:31:37 AM PDT by Safetgiver ( Islam makes barbarism look genteel.)
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To: mylife
Obama stole 2k from me with the payroll tax!

Only 2K?


30 posted on 07/28/2013 9:32:22 AM PDT by Kip Russell (Be wary of strong drink. It can make you shoot at tax collectors -- and miss. ---Robert A. Heinlein)
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To: Kip Russell

Let’s stay focused here. LOL


31 posted on 07/28/2013 9:33:35 AM PDT by mylife (Ted Cruz understands the law, and he does not fear the unlawful.)
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To: Ancient Man

And that is the ticket brother.
Liquidity.


32 posted on 07/28/2013 9:36:46 AM PDT by mylife (Ted Cruz understands the law, and he does not fear the unlawful.)
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To: Safetgiver
I truly sat and thought “I gots no kids, no family, I don’t want the government to grab what I DO have so why am I being monetarily conservative?” Ya know, I’m spending the crap I’ve got now and ...who gives a shiite?

My parents are still around, but I'm in a similar situation. Once they're gone (a long time from now, one hopes), I'll be sitting on a pretty good nest egg. Without any kids, there's no one to which to leave it...so I'll be taking a lot of expensive vacations starting in a few years when I retire. Why leave it for the State to confiscate?

That's the plan, anyway.

33 posted on 07/28/2013 9:37:06 AM PDT by Kip Russell (Be wary of strong drink. It can make you shoot at tax collectors -- and miss. ---Robert A. Heinlein)
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To: mylife

That’s what the VA and other welfare programs are for. F’em. I paid my way, and seriously if I can get to my .40, I don’t think I give a damn.


34 posted on 07/28/2013 9:37:30 AM PDT by Safetgiver ( Islam makes barbarism look genteel.)
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To: ConjunctionJunction

That part confused me too. I don’t make $2000 a month, so by definition I’d be dipping into savings of one kind or another.


35 posted on 07/28/2013 9:37:46 AM PDT by Ellendra ("Laws were most numerous when the Commonwealth was most corrupt." -Tacitus)
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To: Kip Russell
I marvel at the number of people who are broke and on government assistance who can afford tatoos, piecings, "bling" jewelry, cell phones, massive TV's and nicer cars than I drive.

I also marvel at the number of parents who bail out their adult children when they need a $2000 car transmission repair.

Hardship, hunger and fear for your survival are great motivators. Unfortunately, most Americans have never experienced any of them. My parent's generation was hardened by the Great Depression and WW 2. My generation is soft, weak and undisciplined. Many of our children are unprepared for what lies ahead.

36 posted on 07/28/2013 9:39:18 AM PDT by Senator_Blutarski
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To: Kip Russell

God bless you son. I once thought I’d give it to United Way (now it would go to the Race Pimps), the Church (Catholics who educated me would give it to Brazil or Argentina or some other African shithole) or the Protestants who would espouse the queers. Nope, spend it.


37 posted on 07/28/2013 9:42:39 AM PDT by Safetgiver ( Islam makes barbarism look genteel.)
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To: RegulatorCountry

Yeah, there’s people I work with who complain that they don’t get paid enough to cover their own rent, and in the next breath they brag about their bar-hopping and fancy pedicures.

I’m trying to pay down my medical debts and build a house, and somehow I do so on less than they complain about.


38 posted on 07/28/2013 9:42:42 AM PDT by Ellendra ("Laws were most numerous when the Commonwealth was most corrupt." -Tacitus)
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To: Safetgiver

I just do not understand what the whining is about.

I figure when I get old and die I will die.
I never expected Nubile young Nymphs to feed me grapes while I lay on silken sheets at age 75.

Do that stuff when you are 25.


39 posted on 07/28/2013 9:43:32 AM PDT by mylife (Ted Cruz understands the law, and he does not fear the unlawful.)
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To: Ellendra

Try to explain the concept of “pay yourself first” to these people and they will look at you like your from another world.

Financial ignorance is rampant in this country. (and is a big part of our problems).


40 posted on 07/28/2013 9:58:07 AM PDT by desertfreedom765
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To: Kip Russell
If your roof sprung a leak ... would you be able to write a check to cover such an emergency?
Depends where you live. In the 'burbs, you DIY, or write the check.
In the 'hood, you just ask for someone else's money to fix it (write a check? LOL ...).
41 posted on 07/28/2013 10:06:48 AM PDT by oh8eleven (RVN '67-'68)
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To: Kip Russell
Kip, i don't want to hijack the thread, it is important, but here are two related links, as well. I have added your link to my saved folder. Thanks for posting.

3/4 Americans Living Paycheck to Paycheck

17 Signs...

42 posted on 07/28/2013 10:09:58 AM PDT by IllumiNaughtyByNature ($1.84 - The price of a gallon of gas on Jan. 20th, 2009.)
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To: Kip Russell
My Dad.a child of the Depression,taught me to always live below your means.He taught me this lesson by example,not with lectures.My Dad was clearly "upper middle class" for all of *my* life but he and my Mom clearly struggled in the early years of their marriage.My Dad,for the last 40 years of his life,wore Timex watches (the $15 variety) despite having been able to afford something *much* more expensive.He always drove Oldsmobiles despite his ability to afford something *noticeably* more expensive.He always wore expensive suits because his job required it but otherwise...no expensive clothes,jewelry or anything else.

I'm a lot like my Dad.I've always lived well below my means and,as a result,could easily handle emergency dental work,roof repair or car breakdown.

43 posted on 07/28/2013 10:19:58 AM PDT by Gay State Conservative (If Obama Had A City It Would Look Like Detroit.)
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To: mylife

I never expected Nubile young Nymphs to feed me grapes while I lay on silken sheets ...YOU DON’T???? I’m shocked!


44 posted on 07/28/2013 10:22:20 AM PDT by Safetgiver ( Islam makes barbarism look genteel.)
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To: Gay State Conservative

God bless us cheap bastards.
No one ever got rich writing a lot of checks.


45 posted on 07/28/2013 10:23:35 AM PDT by mylife (Ted Cruz understands the law, and he does not fear the unlawful.)
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To: Safetgiver

I don’t know how you rich people sleep at night!

“On top of a large pile of money with many beautiful women” LOL


46 posted on 07/28/2013 10:25:26 AM PDT by mylife (Ted Cruz understands the law, and he does not fear the unlawful.)
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To: Kip Russell

Could I pinch $2000.00?


47 posted on 07/28/2013 10:25:43 AM PDT by Jeff Chandler (o : Tagline Test ; -)
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To: Safetgiver
...I once thought I’d give it to United Way (now it would go to the Race Pimps), the Church (Catholics who educated me would give it to Brazil or Argentina or some other African shithole) or the Protestants who would espouse the queers.

Those listings are the extent of organizations to which you would make donations? You sure have a limited imagination.

48 posted on 07/28/2013 10:50:32 AM PDT by OldPossum
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To: Red Dog #1

Agreed. And his Financial Peace University program should be mandatory for college students.


49 posted on 07/28/2013 10:59:39 AM PDT by tbw2
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To: Kip Russell

It’s worse than it seems, because many people live a month ahead on their credit cards. If something goes wrong with their cards, they are instantly, say -$2000. So to raise $2000, they would have to raise $4000.


50 posted on 07/28/2013 11:05:54 AM PDT by yefragetuwrabrumuy (Be Brave! Fear is just the opposite of Nar!)
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