Are We Currently in a Recession: Suze Orman Believes So
From Wall Street to suburban households, the fear of a looming recession has gripped nearly everyone. Amid corporate layoffs, shrinking spending, and an air of financial uncertainty, it has also become common to start wondering: Are we currently in a recession?
According to personal finance expert Suze Orman, the recession is already here for a lot of people. Orman shared her findings based on a recent survey conducted by her finance startup SecureSave.
According to the survey, 67 percent of consumers said they were unable to cover an unexpected $400 expense without turning to lending opportunities. This renders two in three Americans incapable of covering such an emergency need on their own.
These findings go right against a similar survey from 2021 conducted by the Federal Reserve, which indicated that 68 percent of consumers would pay for an unexpected expense of $400 using cash instead of other methods. In turn, 2021 saw the highest percentage of people who were able to cover such an emergency expense out of their own pocket since the Fed’s survey started in 2013.
But now, SecureSave’s findings put a dent in that optimism.
Speaking to Bloomberg, Orman further mentioned that consumers are currently struggling with managing high interest rates, which may lead them on the doors of credit card delinquency. She further explained that 2023 could see a sharp increase in these instances.
Pondering on are we currently in a recession? Orman mentioned that the experience has begun for a lot of Americans. The survey’s findings further supported this analysis by showing that 74 percent of consumers have little to no savings and instead live paycheck to paycheck.
When people have little to no savings, it creates the conditions for them to fall back on borrowing through credit cards or loans, which further weakens their financial position. Given the unpredictable situation, Orman urged consumers to put some money away to be able to cover their personal expenses.
The New York Times bestselling author further mentioned that even having a little cushion can go a long way in alleviating anyone’s financial woes, which makes it all the important to save whatever amount of money you can.
SecureSave’s survey included a total of 1,100 adults.
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