From staff reports
It takes more than two years to sock away enough money to address a six-month emergency fund in the Dallas metro area, a new Bankrate.com report revealed.
The area ranks 15th hardest of the top 50 metros when it comes to building a six-month emergency savings fund. That fund would be able to pay for housing costs (mortgage or rent, insurance, property taxes) as well as living expenses like groceries, transportation, utilities, etc.
Factoring all that in, Dallas-area household can theoretically save up to $9,704 of its $56,671 annual take-home pay, Bankrate said, which means it would take 29 months to achieve the area’s average recommended emergency fund of $23,484, enough to cover these expenses for six months.
“A middle-of-the-road median annual income (17th highest), coupled with the 7th highest property taxes, could be holding Dallas-area residents back from saving more,” Bankrate said.
Memphis was the easiest — it would take the typical Memphis household almost $16,000 of its annual $46,177 take-home pay each year. San Jose is one of the worst for savers, where the typical household would come up more than $31,000 short of breaking even each year, way off of the almost $59,000 they would need to cover six months of expenses.
“Now more than ever, Americans need to start stashing away money to cover any financial emergencies. This year’s government shutdown highlighted how thousands of Americans are living paycheck to paycheck,” Bankrate said. “Establishing an emergency fund in hard-to-save areas may require cutting spending in some areas but being ready for the next financial crisis is priceless.”
And many don’t save, studies show.
“Four in 10 U.S. adults would have struggled to cover a relatively small $400 emergency expense in 2017. Without savings, Americans would have had to sell something, borrow or leave the unexpected financial bill unpaid for, according to a Federal Reserve report released last year,” Bankrate.com data reporter Adrian Garcia said. “Earlier this year, a Bankrate survey showed similarly troubling findings with only 40 percent of respondents saying they’d pay an unexpected $1,000 expense, such as a car repair or emergency room visit, from savings.”