Most Americans Still Lack a Rainy Day Fund

Last Updated Jul 21, 2009 4:36 PM EDT

I can't quite figure out what Americans are waiting for. Despite the recession and daily headlines of corporate layoffs, the average person still hasn't set much money aside for a rainy day fund.

According to a recent survey put out by Country Financial, nearly half of Americans say they wouldn't be able to pay their bills on time if they were out of work for more than a month.

Well, I've got news for you. The unemployment rate, which currently sits at 9.5%, is only predicted to increase so more of us are going to find ourselves unexpectedly out of a job. And the chances you could find a new situation within a month of a layoff are pretty slim. Sure it happens occasionally, but probably about as often as couples who fall in love at first site and live happily ever after.

Far more common is the person who ends up out of work for an extended period of time. According to the latest government statistics, there are 4.4 million people, or roughly 30% of those who are unemployed, who have been looking for a job for more than 27 weeks. And there are another 2.2 million who lack a paycheck but have given up finding a new employer.

Even worse, these figures don't include the 9 million workers like me who are "underemployed", or working part-time because they can't find anything full-time.

And then there are the lucky ones, the folks who do eventually find new jobs. But even they may find themselves short of cash if their current expenses are too high. That's because I'm finding many people who are fortunate enough to find a new full-time situation are forced to take a pay cut versus their last gig. This really isn't too surprising when you consider someone on the unemployment line doesn't have much leverage to negotiate for more money in this economy.

So I ask again. With all this in mind, can someone please explain to me why half the country still doesn't have any sort of rainy day fund and are willing to put themselves and their families in such a precarious situation?

Hanging in the Balance image by Betsssssy, CC 2.0.