When I first studied for my real estate license 35 years ago, I learned a shocking fact: that the majority of Americans are only one emergency (defined as an unexpected $500 bill) from becoming homeless. An emergency could come from sickness, crime, change in employment or transportation such as car repair or auto accident.
Right now, the mandatory "shelter-in place" order in San Jose, Santa Clara County and throughout California, designed to slow the spread of the novel coronavirus known as COVID-19, is creating that real financial emergency for many Californians. For someone living paycheck to paycheck, lack of even one paycheck is a dire circumstance.
While many people have a variety of saving instruments, such as 401K, Roth-IRA, and even insurance, stocks and bonds, the most vulnerable residents may have only a basic bank savings account, retailer gift cards they could resell or a couple of hundred collars in cash under the mattress. The small savings amounts many have is not enough to replenish the loss of even one paycheck. For some industries, such as personal care and travel, the impact looks to be much longer than the 2-3 week shelter-in-place currently in effect.
Whether it is reduced hours at work for restaurant workers, forced temporary layoffs for retail and travel industry pros to cease in-person work orders for those in real estate, insurance and sales, we must anticipate the pandemic will dramatically impact our most vulnerable populations financially. And that's not including the personally devastating health and cost impact for those who become infected with COVID-19.
This pandemic will highlight the known fact that the majority of Americans are only one emergency away from becoming homeless.