The majority of Americans either are or have been broke. But what does this mean, and what does it look like to be broke in the changing landscape of the modern age?
Everyone’s familiar with the concept of being ‘broke,’ but what does it really mean?
It’s a bit of a taboo subject. The word comes from an old use of the word break, meaning impoverished… and connotes helplessness, disgracefulness, or embarrassment. It’s more similar to an idea of action, rather than circumstance — no one is born broke. It’s something that happens you you. You get wiped out, busted, or go bankrupt (the ‘rupt’ from an Italian word for broken). The Victorians used to say you were ruined.
Being broke doesn’t necessarily mean you have zero dollars to your name, and it’s not synonymous with poor. Poor means you never had money to begin with, whereas going broke means you lost money you once had.
So what does being broke look like in America?
A survey of over 1,000 Americans had shocking results: 86% of people said they were either currently broke, or had been in the past. That’s a huge amount of people! And 28% of millennials said they got to that point just by overspending on food.
On average, people considered having only $878 available either in cash or a bank account to mean they’ve gone broke. It may not seem like a small sum, but it’s 71.3% of the national average rent. Seeing as the classic rule is not to spend more than 28% of your income on housing costs, many people end up seeing their $878 dwindle away quickly.