America Saves Week: Pay Off High-Interest Debt
February 26th, 2016
All week the Hope Policy Institute used the Corporation for Enterprise Development’s 2016 Assets & Opportunity Scorecard to examine the financial security of Mid South households. The Scorecard illustrates that many Mid South households continue to struggle financially – in both covering day-to-day living expenses and saving for a more prosperous future. It is more difficult for these households to discover financial freedom when overwhelmed by debt.
Asset poverty refers to the percentage of households without sufficient net worth to live at the poverty level for three months in the absence of income. The Scorecard found that one in three (27 percent) Mid South households are asset poor, meaning that the assets they do have, like a savings account, or home, are overwhelmed by debt (See Chart). Additionally, an average of 17 percent of Mid South households are extreme asset poor, meaning that their household debt exceeds their financial assets, and they have no financial cushion to weather any type of financial crises.
With planning, discipline, patience, and maybe some outside help, almost anyone can reduce their debts and start to accumulate wealth. Some strategies include finding places to cut spending to pay down your debts faster and find places to trim your expenses.
This week is America Saves Week – a national effort that encourages Americans to set a savings goal, make a savings plan, and save automatically. The Hope Policy Institute has blogged throughout the week about America Saves Week and the issues that Mid South communities face on the #PolicyMatters blog. Please see our blog for more on “America Saves Week: Save for Emergencies” and “America Saves Week: Assess Your Savings.”
Corporation for Enterprise Development. (2016). Assets and Opportunity Scorecard, 2016. Retrieved from http://assetsandopportunity.org/scorecard/