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Many Californians have no emergency savings

January 31, 2012|By Walter Hamilton
  • Job seekers attend a career fair at the Crenshaw Christian Center in South Los Angeles
Job seekers attend a career fair at the Crenshaw Christian Center in South… (Ropbyn Beck / AFP )

More than three in 10 people in California don’t have enough savings to get by for three months if they were to lose their job, according to a study released Tuesday.

More than two years after the official end of the recession, 30.9% of Californians have little to no financial cushion, according to the report by the nonprofit Corp. for Enterprise Development. If illiquid assets -- things that can’t quickly or easily be converted into cash, such as a home -- are excluded from the equation, the number rises to an even more troubling 43.1%. The complete study is available here.

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

The study analyzed the 50 states and the District of Columbia. Overall, California ranks a dismal 39th nationwide in financial security and was at or near the bottom in key yardsticks, such as unemployment and education.

Judged by its unemployment rate, California ranks 49th. And the state’s underemployment rate -- which measures those who work part time but want to be full time -- is 50th. California also ranks 49th in average credit-card debt.

As for education, California is 50th in high-school degree attainment, 44th in eighth-grade math proficiency and 47th in reading ability, according to the study.

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