What’s your definition of poverty? If you take it to mean living at or below the poverty line, then it’s a fact that almost 50 million Americans already find themselves in this position. However, if you define poverty in terms of walking a financial tightrope that one significant financial blow could cause you to fall from, then the number of Americans whose circumstances mirror this situation is much, much larger.
Presently in the United States of America, almost 50% of the population has not accumulated any significant amount of savings to allow them to weather unforeseen financial hardships. What this means is that if any of these individuals or families encounter any major financial curve-ball, they will find themselves facing severe and long-term economic destruction. That curve-ball may take the form of medical bills, sudden unemployment, or divorce, to name a few possible scenarios. The point is that practically half the country is a potential hairs-breadth away from financial ruin.
According to a report recently released by the Corporation for Enterprise Development, almost fifty percent of all Americans are living off their savings and are at the end of their rope. One piece of bad luck would have them facing severely painful financial conditions. It’s shocking to consider the fact that this scenario is representative of half of the country. Based on the findings of the report, over 127 million people in America are what is described as liquid-asset poor. It means that there is simply no room for financial calamity of any kind. Needless to say, this is a frightening place to live in, and a huge gamble to take, whether that gamble is taken deliberately, or forced upon someone.
What makes this reality even more alarming is that many people in this situation do not recognize the gravity of their situation. Because a regular income may still be coming in, the expectation is that they will continue to receive it indefinitely, or that no unforeseen tragedy will struck that will fundamentally undermine their financial stability. This expectation is of course severely flawed. The lack of savings compounds the problem of the housing market crisis brought about by corporate greed and corruption, and as a result we have a situation in which millions of Americans have lost their home to foreclosure.
When calamity does strike in the lives of these people, the huge sense of desperation that is brought about often drives them to seek out the intervention of unethical payday lenders who demand ridiculous interest rates that lock these already trapped people into even greater levels of debt. The importance of savings, even if only representative of an emergency fund that covers three months of expenses, can not be over-emphasized. Of course, it’s often true that putting money aside for savings is an impossibility for millions of Americans who are failing to make their mortgage payments.
Federal housing initiatives like the HAMP program have the right kind of objective (alleged at least), but the problem is that the its implementation has been littered with flaws and manipulation that have left countless struggling homeowners feeling hopeless. Loan modification is a very real source of hope for struggling Americans, and if pursued with an empowering and thorough strategy in place, it can result in significant and long-term financial relief, such as is needed by so many people in this country.
About Carla Ghosn
|CEO and Founder of MyCaal.com, earnestly helping American homeowners save their home. If you need loan modification help, visit www.mycaal.com to access loan modification software that helps you get pre-qualified and prepares your loan modification package online.|