American household incomes drop for first time since 2011: What to do if you're struggling financially
American household incomes saw their first statistically significant drop since 2011, falling 2.9% from 2019 to 2020, according to the U.S. Census Bureau.
Economic growth stalled in 2020, evidenced by a median household income of $67,521; that's a decrease from $69,560 in 2019, according to the Census Bureau’s Income and Poverty in the United States: 2020 report, released in conjunction with the Bureau of Labor Statistics (BLS).
The median salaries of all workers decreased by 1.2% in 2020, offset by gains for year-round, full-time workers where wages increased 6.9%.
If you were affected by wage declines to your household income, a personal loan could help you meet expenses or pay down other high-interest debt like credit cards. With today’s historically low rates, Americans can save money on their monthly payments by consolidating debt. Visit Credible to find your personalized interest rate for a personal loan today.
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Poverty rate climbs without economic stimulus
As sources of income decreased for the average household, the Census Bureau's study shows the official poverty rate was 11.4%, one percentage point higher than 2019 and a break in a trend of five consecutive years of annual declines. There were a total of 37.2 million people in poverty in 2020, up by 3.3 million from the year prior.
However, another report, which estimates post-tax income (versus pre-tax) and included stimulus payments was more optimistic. The Supplemental Poverty Measure (SPM) was 9.1% in 2020, 2.6 percentage points lower than 2019, according to the Census Bureau’s The Supplemental Poverty Measure: 2020 report.
When including economic stimulus payments, the data was more reassuring, however many Americans still struggled from the effects of coronavirus pandemic-induced economic shutdowns in 2020. One way to get back on your feet is through a cash-out refinance. Mortgage rates are currently hovering below the 3% mark, making now the ideal time to take money out of your home. It will also allow homeowners to skip their next monthly payment and perhaps even lower their new payment while taking out cash. Visit Credible to compare multiple lenders at once and see which one has the best rate for you.
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Where can I take out a loan?
If you are struggling from loss or decrease in income and need to take out a loan to catch up, there are several options available.
A personal loan can help you pay unmet bills, consolidate high-interest credit card debt or even help with home improvement. Visit Credible to compare multiple loan options through various lenders and you can get pre-approved in minutes without affecting your credit score.
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Homeowners can also consider a mortgage cash-out refinance. With interest rates at historic lows, borrowers can take out a refinance and lower their monthly payments by paying less interest while also pulling cash out of their homes. Often after refinancing a homeowner can also skip several months before they must resume making payments on the new home loan. Contact Credible to speak to a home loan expert and get all of your questions answered.
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