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Credit Card Debt Rivals Emergency Savings

February 22, 2012 3:48 am

Only 54 percent of Americans have more emergency savings than credit card debt, according to a recent poll from Bankrate.com. One in four Americans (25 percent) has more credit card debt than emergency savings and 16 percent have neither credit card debt nor emergency savings. 

Bankrate's monthly Financial Security Index held at 97.3, unchanged from January and tied for the highest level since June 2011. Any reading below 100 indicates a lower level of financial security compared with 12 months earlier. 

Despite four straight months of improving sentiment, consumers' overall financial situation is still seen as negative. Twenty-seven percent of Americans report a lower level of financial security now versus one year ago and 24 percent report a higher level. Thirty-eight percent of Americans are less comfortable with their savings now compared with one year ago; only 14 percent are more comfortable. 

Additional survey findings included:
Job Security: Consumers are slightly positive, with 20 percent feeling more secure than one year ago and 19 percent feeling less secure (up from 17 percent in January). 

Savings: Consumers have reported less negativity about their savings in each of the past three months, with fewer feeling less comfortable and more feeling about the same as 12 months ago. 

Debt and Net Worth: Both were little changed from January and maintain essentially neutral readings. 

Credit Card Debt vs. Emergency Savings
- Households with income of $75,000 or more per year, college graduates and retirees are the most likely to have more in emergency savings than credit card debt.
- Parents are the most likely to have more credit card debt than emergency savings.
- Those most likely to have neither credit card debt nor emergency savings are households with income of less than $30,000 per year, those with a high school education or less and the unemployed.
- In a similar Bankrate poll conducted in February 2011, 52 percent of Americans had more emergency savings than credit card debt. Twenty-three percent had more credit card debt than emergency savings and 19 percent had neither credit card debt nor emergency savings. 

The new study was conducted by Princeton Survey Research Associates International (PSRAI).

Published with permission from RISMedia.