The $400 Test
Unchanged from a year ago; the share with no cash cushion has not improved since before the pandemic
What is the current $400 Test reading?
37% of American adults could not cover a $400 emergency expense using cash or its equivalent in 2025, according to the Board of Governors of the Federal Reserve System's Survey of Household Economics and Decisionmaking (SHED). This figure has been essentially unchanged for three consecutive years, after briefly improving to 32% in 2021 when stimulus payments temporarily rebuilt household reserves. Source: Board of Governors of the Federal Reserve System Survey of Household Economics and Decisionmaking (published May 2025).
The Federal Reserve has asked the same question for over a decade, and the answer has stopped improving.
The Fed's Survey of Household Economics and Decisionmaking, fielded in October 2025 and published the following May, found that 37% of American adults could not cover a $400 emergency expense using cash or its equivalent. That figure has been essentially unchanged for three consecutive years, after briefly falling to 32% in 2021 when stimulus payments temporarily rebuilt household reserves.
The Safety Net asks how adults say they would pay a $1,000 emergency. The $400 Test asks whether adults could pay a $400 expense using cash or its equivalent. The questions and methods differ, so one survey does not confirm the other.
Phantom Debt and The Squeeze provide separate context on BNPL use and household budgets. They do not identify how Bankrate respondents would pay the expense or establish a mechanism linking the measures.
The $400 test was designed to measure financial fragility. At 37%, it is measuring something closer to a permanent condition.
Explore Further
Is this happening to you?
Could you handle a $400 unexpected expense right now?
How has The $400 Test changed over time?
Most affected counties
Counties with the highest safety net and buffer scores in the County Distress Index.
Explore all 3,144 counties →| Period | Value | YoY Change |
|---|---|---|
| 2025 | 37% | 0 pp |
| 2024 | 37% | 0 pp |
| 2023 | 37% | 0 pp |
| 2022 | 37% | +5 pp |
| 2021 | 32% | -4 pp |
| 2020 | 36% | -1 pp |
| 2019 | 37% | -2 pp |
| 2018 | 39% | — |
| 2013 | 50% | — |
Frequently Asked Questions
What percentage of Americans can't cover a $400 emergency?
37% of American adults could not cover a $400 emergency expense using cash or its equivalent in 2025, according to the Federal Reserve's Survey of Household Economics and Decisionmaking. This has been essentially flat for three consecutive years.
Has the $400 emergency savings figure improved over time?
It briefly improved to 32% in 2021 when stimulus payments rebuilt household reserves, but has since reverted to 37% and plateaued there. The Fed has asked this question annually since 2013. The plateau at 37% suggests a structural floor — a share of the population that cannot accumulate even minimal savings regardless of labor market conditions.
What do people use instead of savings for emergencies?
Those without cash savings typically borrow (credit cards, personal loans), sell possessions, use Buy Now Pay Later services, or skip the expense entirely. Buy Now Pay Later volume has grown from $2.2 billion in 2019 to $43.9 billion in 2023, with 24% of BNPL users paying late according to the Fed's own SHED survey.
What is the Fed SHED survey?
The Survey of Household Economics and Decisionmaking (SHED) is an annual Federal Reserve survey measuring the financial well-being of U.S. households. It is fielded in October–November and published the following May. The $400 emergency question has become one of its most widely cited findings.
How does the $400 Test relate to the American Distress Index?
The $400 Test is not an input to the American Distress Index. American Default Research tracks it alongside the index as household-level confirmation of what the macro savings rate shows: financial cushions thin enough that a minor expense becomes a financial event.
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