I think you&#x27;re confusing loss of value with loss of savings. So if your stocks lose half their value, then you now have &quot;less cash equivalent savings&quot; but you still have savings. Even in the dot com crash (where I was <i>not</i> diversified and had a lot of tech stocks) the reduction in value across the board was, in aggregate, about 70% even though some stocks it was 99.9%. But all of that was &quot;ok&quot; because I didn&#x27;t need that money to live on, it was &quot;savings&quot;.<p>Similarly with house values, if you own your home outright it doesn&#x27;t matter if the real estate market crashes, you can still live there. But it might make moving less desirable (or not if you can find a good deal somewhere else).<p>The article is talking about people who find themselves unable to pay for repairing a vehicle after an accident without going into credit card debt. That can start a spiral into insolvency.