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The statistic is used to show how unequal things have become in the U.S.: Some 40% of Americans would struggle to come up with even $400 to pay for an unexpected bill.
If — or, more likely, when — they’re confronted with such an expense, they’d probably have to sell something or go into debt. The now oft-cited figure comes from the Federal Reserve’s 2018 Survey of Household Economics and Decision Making, in which some 12,000 households were asked about their financial well-being.
Just how have so many Americans become so short on cash? Anqi Chen at the Center for Retirement Research at Boston College recently tried to answer that question. “If that many people can’t cover a very small, unexpected expense, how can we expect them to save for retirement?” Chen said, explaining the center’s interest in the bleak finding.
At first, only more questions emerged. Mainly, there appeared to be a gulf between what people said they could afford and…