A report from the City of Detroit has found that many families below the federal poverty line would struggle if faced with a $400 emergency.
An emergency that costs residents $400 could put many Detroiters in debt or cause them to forego essential needs like healthcare, the report from the city's Legislative Policy Division found.
The report cited figures from the U.S. Census Bureau finding about a third of Detroit's population lives under the poverty line.
"It is apparent that those living in poverty in the State of Michigan and city of Detroit have an exceedingly tough time making ends meet," the report said.
Afton Branche-Wilson is with University of Michigan Poverty Solutions. She was not involved in developing the report, but she agreed with much of its findings.
"I think this question is a question about financial health. And when you're financially healthy, you have money set aside in savings, you have a room on your credit card to be able to afford an emergency. So what this is saying is that many Detroiters are not financially healthy," she said.
In 2021, the Detroit Metro Area Communities Study from the University of Michigan found that 22% of Detroiters would not be able to afford a $400 emergency right now, while 34% of Detroiters said they would pay for it from checking or savings.
This is slightly different from the area of analysis that the report focuses on, which is how many of the 219,000 people in poverty could afford this expense.
Branche-Wilson explained the difference.
"Some people have access to social capital, so they can borrow money from a friend or family member. Some people said they would put it on a credit card. Some people said, I can just pay for it out of my savings or checking. Some people said they would sell something," she said.
"There's ways that the people afford these things. It's not as if it's either, 'Yes, I can afford it,' 'No, I can't afford it.' There's lots of different options that folks tap into when faced with emergencies like this," said Branche-Wilson.
