Whether it's a broken water heater, an unexpected medical bill or a car wreck, emergencies happen to everyone. But a startling number of Americans are unprepared to cope with them, money-wise. According to Bankrate's latest financial security index survey, 34 percent of American households experienced a major unexpected expense over the past year. However, only 39 percent of survey respondents said they would be able to cover a $1,000 setback using their savings. "While tapping savings to pay off an emergency was the most common response, more than a third of Americans would sink into one type of debt or another, potentially harming their financial security," Bankrate says in the report.

Using a credit card was the second most popular answer, with 19 percent of respondents saying they'd deal with an emergency with plastic and pay it off over time. The numbers aligned with respondents' annual incomes. "Lower wage earners, those making less than $30,000 a year, were twice as likely to use some form of borrowing than savings, while households making more than $50,000 were more apt to use cash," Bankrate says. A similar 2016 GOBankingRates survey found that 69 percent of Americans had less than $1,000 in total savings and 34 percent had no savings at all.

The simple solution to keep an unexpected expense from bankrupting you or putting you into debt is to build an emergency fund. But that doesn't always take precedence as Americans focus on staying on top of bills, paying off debt and working toward other financial goals. However, even if you're in the red, it's still smart to put some money away. Personal finance expert Dave Ramsey says building a $1,000 emergency fund is the first "baby step" toward getting free from debt, because something is always bound to go wrong, no matter how careful you are. "Car blows up. Transmission goes out. You bury a loved one. Grown kids move home again. Life happens, so be ready," Ramsey writes in "The Total Money Makeover." "This is not a surprise."