The researchers at Prudential released a very interesting study on how the shutdown affected the household finances of federal workers. As you can imagine, the impact was pretty dramatic with nearly a month of missing paychecks.
Eighty-three percent of survey respondents reported an uptick in their overall stress levels as a result of the shutdown, including 50% who were “much more stressed.” Twenty-three percent reduced or stopped spending on health and medical expenses for themselves or family members during the shutdown, and 16% reduced or stopped spending on care services they normally provided for children or adults.
The impact of the shutdown just reinforced what financial experts and researchers have been saying for a long time, people are just not prepared for an emergency situation.
This all looks like bad news and what makes it more worrisome is that federal workers with more than the average amount in savings than the general public and yet workers significantly struggled. Sixty-one percent of survey respondents said they entered the shutdown with $1,000 or more in emergency savings, compared with just 46% of the general population.
This awesome study from Prudential lists the key takeaways from workers living through the pain of the shutdown.
The report says, “The impact of the government shutdown on federal workers and their families serves as a stark reminder that many Americans are ill-prepared to navigate even a brief disruption in their income. Fifty-two percent of the federal workers and spouses who were surveyed said they plan to add more money to their existing emergency funds. Ten percent who don’t have emergency savings funds plan to start them. (Another 10% said they don’t intend to change their emergency savings, while 28% said they would like to have an emergency savings fund but don’t think they can afford it at this time.)”