The findings highlight not only how resilient many household budgets have been during the pandemic, but how some actually ended up benefiting from it. Yes, it put 22 million out of work in the initial months, but it also prompted unprecedented government subsidies. Case in point: Some 37 million people with federal student loans have had more than two years without any obligations. Not only can they skip payments without penalty, but interest hasn’t accrued, giving them the breathing room to pay down their balance, buy a house or invest. In turn, 73% of student borrowers with outstanding debt said their finances were at least “okay” financially in 2021, compared to 65% in 2019, according to a survey the Federal Reserve released Monday on the economic well-being of households. By contrast, 76% of those who never had student loans were at least “okay” financially in 2021, down from 77% in 2019. How well people’s finances will hold up in the face of the latest wave of economic challenges—including inflation running near its highest in decades, and a battered stock market—remains to be seen. Many responded to the pandemic’s uncertainties by socking extra money away, a habit that got a big boost from government emergency stimulus programs. But in more recent months, inflation has forced people to dip into that savings to continue their spending, a trend reflected in the Northwestern survey. The average amount of personal savings fell to $62,000 in 2022 from $73,000 in 2021. Have a question, comment, or story to share? You can reach Diccon at dhyatt@thebalance.com.Want to read more content like this? Sign up for The Balance’s newsletter for daily insights, analysis, and financial tips, all delivered straight to your inbox every morning!
