A recent survey found that more than half of Americans would resort to a source other than their savings account to pay for an unplanned expense of $1,000 or more.
Of the 2,700 respondents polled, 36 percent said they would use money they had put away in their savings account to pay for an unanticipated cost, according to a survey conducted by the National Foundation for Credit Counseling.
Gail Cunningham, spokesperson for the NFCC, said the findings may be an indication many consumers don't have a satisfactory rainy day fund.
To pay for the expenses, consumers turned to a variety of options. Seventeen percent said they would borrow from friends or family while the same number said they'd likely neglect a monthly bill to pay for the unexpected cost. Less common responses were selling or pawning assets, getting a cash advance on a credit card and taking out a loan.
"Without adequate savings, consumers have poor resolution choices when an emergency arises," said Cunningham. "People often say they can't afford to save, but the truth is that they can't afford not to."
Having a high FICO score can help consumers borrow money at a low rate of interest. Unverifiable credit notations may unfairly lower a score, potentially costing them money. Individuals should review their financial histories so that they can be aware of questionable credit reporting whenever it occurs.