Key takeaways

• Nearly 2 in 5 (37%) Americans say they couldn’t afford an emergency expense over $400
• The median emergency savings for Americans is $600
• 21% of people have no emergency savings at all
• More than 3 in 5 (62%) Americans say that having dedicated emergency savings is a priority for them; yet 57% say high inflation and price increases have held them back from contributing this year
• 1 in 4 (25%) people dipped into emergency savings to cover basic living expenses in the past year
• Paying down debt is a higher priority than saving for an emergency for 57% of Americans
• 34% believe they could handle any emergency expenses in the coming year

Are Americans prepared for a financial emergency?

Many, it turns out, are not. A new Empower study reveals more than 1 in 5 (21%) Americans have no emergency savings — money set aside for unexpected financial events such as job loss, home and car repairs, and medical bills. Nearly 2 in 5 (37%) couldn’t afford an emergency expense over $400.

Conventional wisdom tells us to plan for the unplanned by socking away enough to cover 3 – 6 months of expenses. Yet Americans have accumulated a median emergency savings of just $600. Baby Boomers and Gen Xers have put aside the most for the unforeseen with median savings of $1,000 and $868, respectively, and Millennials and Gen Zers the least with median savings of $500 and $200, respectively. The median savings for men sits at $1,000 — twice as much as the median savings for women.

What’s getting in the way?

Though more than 3 in 5 (62%) Americans say having a dedicated emergency savings is a priority, close to half (47%) say regular monthly expenses are too high for them to put money away.

Economic challenges are impacting Americans’ ability to prepare, too: Nearly 6 in 10 (57%) say high inflation and price increases have held them back from contributing to their emergency savings this year. Almost a third (30%) have depleted their emergency savings and have been unable to catch up or replenish it, while 2 in 5 (40%) have not contributed to their emergency savings in more than a year.

High credit card balances could also be putting the squeeze on emergency savings practices. Almost 3 in 5 (57%) Americans prioritize paying down debt over building up an emergency fund.

Are Americans losing sleep over saving up?

More than half (54%) feel stressed that they don’t have enough saved for an emergency. Relationship status seems to be a factor in how secure people feel, too, with more single adults (58%) expressing anxiety about not having a big enough emergency nest egg than those who are married (46%).  

Just as many people (54%) say they worry about paying emergency expenses if or when the time comes — and 60% of Millennials, 58% of Gen Xers, and 57% of Gen Zers feel that way.

When asked how they’d cover an unexpected expense in the year ahead given their financial situation, roughly a third of Americans (34%) say they could handle it while 15% are unsure.

Is there a secret to saving success?

Despite obstacles, many Americans are still striving to widen their emergency safety net: 43% contributed to emergency savings in the past year and 42% did so within the last 6 months. In the past year, more Baby Boomers (51%) and Gen Xers (44%) were able to tuck away emergency savings than Millennials (39%) or Gen Zers (40%).

Among the savers, roughly one third (32%) subsidize their emergency savings sporadically when they have extra disposable income, while 14% contribute on a regular basis, 14% incorporate emergency savings into their monthly budget, and 11% automate monthly contributions.

Asking for advice is helping some Americans stay on track, too. One in 5 (20%) worked with a financial advisor to set emergency savings goals and establish a plan. Seeking guidance is more typical among Millennials (32%) and Gen Zers (31%) and least prevalent among Baby Boomers (9%) and Gen Xers (11%).

Why dip into the emergency pot?

In the past year, more than one third (35%) of Americans were able to steer clear of unexpected financial situations, but others tapped emergency savings to take care of day-to-day outlays, with 1 in 4 (25%) dipping into emergency savings to afford basic living expenses.

Here’s a look at some of the emergency expenses Americans encountered in the past year.

In case of emergency…break out the cash

Liquidity is critical when it comes to tackling surprise expenses, and nearly one-third of U.S. adults (30%) stash emergency savings in cash. Emergency cash is king for even more Millennials (35%) and Gen Xers (33%).

Additionally, 33% are looking to grow emergency money in a high-yield savings account. While it’s the savings vehicle of choice for 43% of Millennials and 39% of Gen Zers, only about a quarter (26%) of Baby Boomers and Gen Xers choose this option.

About the study

The Empower “Emergency Savings” study is based on online survey responses from 1,192 Americans ages 18+ fielded by YouGov from April 12 – 15, 2024. The survey is weighted to be nationally representative of US adults (aged 18+).