"Asset Poor" Households Growing in Number

A new report by the Corporation for Enterprise Development (CFED) shows a major increase in what they call "asset poor" households:

In the United States, 27 percent of all households are “asset poor,” meaning they lack the savings or other assets to cover basic expenses for just three months if a layoff or other emergency
leads to loss of income, according to the 2012 Assets & Opportunity Scorecard, released today by the
Corporation for Enterprise Development (CFED). Since the release of the 2009-2010 Assets & Opportunity Scorecard, the number of asset poor families has increased by 21 percent from one in five families to one in
four families. The asset poverty rate is now nearly twice as high as the Census Bureau’s official income
poverty rate of 15.1 percent.

An increase of 21% is certainly significant.

“Growing numbers of families have almost no savings or other assets to see them through if they lose their jobs or face a medical crisis,” said Andrea Levere, president of CFED. “Without savings, few will be able to build a more economically secure future, including buying a home, saving for their children’s college educations or building a retirement nest egg.”

Levere added that the Scorecard findings are “particularly disturbing in the context of precipitous drops in
incomes for many Americans and widening of the wealth gap between the richest and poorest households.”

Last year Business Insider provided us with 15 graphs looking at income inequality and wealth in the US. Graph #5 illustrates the flat wages many of us have experienced since at least 1990.

A look at key findings from the report shows something of crucial importance:

One in five jobs (22 percent) is low wage and nearly half of employers (46 percent) do not offer health insurance. Most workers (55 percent) do not have or participate in retirement plans. These low- quality jobs make it harder for families to both meet their needs today and create a reserve for tomorrow.

As wages continue to stagnate, good paying jobs are replaced with low wage jobs, and the costs of housing, food, transportation, heating oil, and everything else continue to rise, how will people save for the future, when they can't even make ends meet in the present?

And why aren't the presidential candidates talking about this?


cross-posted at MainSt/workingamerica.org