Americans get poorer as expenses surge

Breitbart’s John Carney evaluates the state of the economy under President Biden on 'Kudlow.'

Americans are getting poorer as expenses climb and savings dwindle, according to a new survey from LendingClub Corporation, the parent company of LendingClub Bank, a digital marketplace bank. 

In May 2023, the Fed released the «Economic Well-Being of U.S. Households in 2022,» the latest edition of an annual report commonly used in measurements of financial well-being. Since 2013, these annual reports have tracked consumers’ stated ability to afford a theoretical $400 emergency expense — a number that seems outdated in today’s economic environment, LendingClub reported. 

LendingClub and PYMNTS have examined this issue since 2022 and have found that the $400 benchmark does not accurately reflect today’s consumer experience, per a press statement. «In fact, two-thirds of the unexpected expenses consumers experienced cost more than the benchmark of $400, with 41% spending double that amount or more,» the statement said. «Furthermore, the average emergency expense was approximately $1,700, reflecting a year-over-year growth of 16 percent.»

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Utility bills on a table. (iStock)

Alia Dudum, money expert with LendingClub, says this study ultimately shows that the Fed’s $400 emergency expense benchmark, which has remained the same for 10 years, is no longer an accurate figure to use when assessing a consumer's overall financial well-being as it doesn't factor in inflation over the last decade or address the macroeconomic volatility we've seen since the beginning of the pandemic.

For example, she added, two-thirds of the unexpected expenses consumers experienced cost more than the