I was shocked—but then again I wasn’t—when I read the article, The Secret Shame of Middle Class Americans – Nearly half of Americans would have trouble finding $400 to pay for an emergency. I’m one of them, in The Atlantic this month.
Take a moment to read this lengthy article because the author, a successful writer of 5 books, would clearly be considered middle class, but falls into the category of having trouble finding $400 to pay for an emergency.
Federal Reserve Board Survey
The Federal Reserve Board runs the Survey of Consumer Finances every three years. The latest report had nothing earth-shattering in it, with the exception of one item. It is best stated by the author of The Atlantic article, Neal Gabler:
The Fed asked respondents how they would pay for a $400 emergency. The answer: 47 percent of respondents said that either they would cover the expense by borrowing or selling something, or they would not be able to come up with the $400 at all. Four hundred dollars! Who knew?
When I left my short stint as a high school math teacher in early 2006 and joined the ranks of the unemployed, I was amazed at the number of former colleagues who were struggling. Then came the Great Recession several years later. I guess I was blind as to the extent that some of my former colleagues were struggling. They suffered from financial insecurity, or what Neal Gabler called “Financial Impotence.”
I like to think I appear reasonably prosperous.
Nor would you know it to look at my résumé. I have had a passably good career as a writer—five books, hundreds of articles published, a number of awards and fellowships, and a small (very small) but respectable reputation. You wouldn’t even know it to look at my tax return. I am nowhere near rich, but I have typically made a solid middle- or even, at times, upper-middle-class income, which is about all a writer can expect, even a writer who also teaches and lectures and writes television scripts, as I do. And you certainly wouldn’t know it to talk to me, because the last thing I would ever do—until now—is admit to financial insecurity or, as I think of it, “financial impotence,” because it has many of the characteristics of sexual impotence, not least of which is the desperate need to mask it and pretend everything is going swimmingly. In truth, it may be more embarrassing than sexual impotence. “You are more likely to hear from your buddy that he is on Viagra than that he has credit-card problems,” says Brad Klontz, a financial psychologist who teaches at Creighton University in Omaha, Nebraska, and ministers to individuals with financial issues. “Much more likely.” America is a country, as Donald Trump has reminded us, of winners and losers, alphas and weaklings. To struggle financially is a source of shame, a daily humiliation—even a form of social suicide. Silence is the only protection.
Does this sound familiar?
Is Financial Insecurity for Real?
I have had discussions with several individuals in the last few days about this topic. Some of them had a hard time believing that, for 47% of the respondents, this was possible.
It took me back to my early days at IBM. Everyone I worked with made good money. Lots of them lived in the same neighborhood, which we affectionately called IBM ghettos. Most of the people I associated with were IBMers. Therefore, their view of the world was that everyone was very well off.
I think this is an even bigger problem today. I live in Austin, Texas, the most economically segregated community in America. Yeah, it is one prosperous city, but not for everyone. Austin came out near the top of the list in Where Not to Be Old and Jobless.
Financial insecurity is real, but it is not visible to everyone. It is easy to look around and only view the scene you want to see.
Heck, look at our current US presidential races! There are a lot of angry people venting their frustrations. Does this surprise the people in Washington, DC? You bet.
Retiring into Poverty
I will be reaching that magic age of sixty soon. I am now seeing friends die or fall ill. I know others who will be forced to retire into poverty. They will no longer be able to work due to health issues, and the only income they will have will come from Social Security.
Retiring into poverty is a real possibility for large swaths of baby boomers.
Did I see this coming? No, not really.
We do not talk about it.
It is embarrassing.
We need to start discussing the issue of financial insecurity.
The survey associated with this post is closed. You can view all of the results from the Career Pivot surveys here.
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