Financial Fragility during the COVID-19 Pandemic

Abstract

Early in the COVID-19 pandemic, much of the US economy was closed to limit the virus's spread, and several emergency interventions were implemented. Our analysis of older (45-75) respondents fielded in April-May of 2020 indicates that about 1 in 5 respondents was financially fragile and would have difficulty facing a midsize emergency expense. Some subgroups were at particular risk of facing financial difficulties, especially younger respondents, those with larger families, Hispanics, and those with low income. Moreover, the more financially literate were better able to handle such shocks, indicating that knowledge can provide some additional protection during a pandemic.