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How Much Does the Average American Have in Savings?

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  • The average American household has $183,200 worth of savings in bank accounts and retirement savings accounts as of June 2019.
  • The median American household currently holds about $12,330 across these same types of accounts.
  • The top 1% of households (as measured by income) have an average of $2,630,760 in these various saving accounts. The bottom 20% have an average of $9,190.
  • Roughly 83% of savings are in located in retirement accounts like IRAs and workplace-sponsored retirement savings plans like 401(k)s.
  • Millennials, who have just started their savings journey, have currently socked away an average of $24,570 retirement savings. Gen Xers have $127,550 in retirement savings. Baby boomers and those born before 1946 have an average of $279,250.
  • 29% of households have less than $1,000 in savings.

You often read or hear stories about how Americans aren’t saving enough for college, for retirement, for a rainy day — for anything, really. But how much do they currently have in their bank, credit union or online brokerage?

MagnifyMoney used data from the Federal Reserve and the Federal Deposit Insurance Corp. (FDIC) to estimate the average and median household balances in various types of banking and retirement savings accounts. 2016 household data from the Fed’s Survey of Consumer Finances was adjusted to 2019 levels by using March 2019 market values and fund flows.

Of course, these are very broad numbers, and very few of the 127 million U.S. households will be average. As of 2016, about 78% of households had at least one of the following: a savings account, a retirement savings account, a money market deposit account or certificates of deposit.

Average account balances

As of March 2019, among all households (including those with no account):

  • The average American household savings account balance is $17,750
  • The average American household has $6,220 in certificates of deposits (CDs)
  • The average American household has $9,430 in money market deposit accounts
  • The average American household has $9,820 in checking accounts
  • The average American household has $149,790 in one or more retirement savings accounts, including individual retirement accounts (IRAs), 401(k)s and other types of retirement accounts

Note that all households won’t necessarily own each type of savings account. For example, only about 7% of households currently have savings in some type of CD, meaning that the 93% without one will necessarily drive down the average.

Here are the average balances among savers, regardless of the kinds of savings vehicles they use. The averages below only exclude the 22% of households without any of these savings accounts. Households that have some savings vehicles but not necessarily all of the savings vehicles below were factored into each average.

Across all “saver” households:

  • The average savings account balance is $24,290
  • The average money market deposit account balance is $12,210
  • The average amount held in one or more CDs is $8,520
  • The average balance of all retirement accounts is $205,020
  • The average checking account balance is $11,970

 

When you look at the average balances of those who own the particular account, the averages are even higher:

  • 51% of American households have a savings account, and the average balance among them is $34,730
  • 18% have money market deposit accounts, and the average balance is $74,970
  • 7% have one or more CDs with an average toal value of $95,600
  • 52% have one or more retirement accounts, and the total average balance is $287,736
  • 83% have checking accounts and the average balance is $11,970

 

Median account balances

Median balances are considerably lower than the averages. For example, the median savings account balance (among those with savings accounts) is $4,960, significantly lower than the $34,730 average American savings account balance. Fifty percent of households have more than $4,960 in those types of accounts, while 50% have less. (The median figures below only include households that have that type of account.)

  • The median American household savings account balance is $4,960
  • The median American household money market deposit account balance is $12,680
  • The median American household amount in one or more CDs is $25,280
  • The median retirement account size in American households is $75,480
  • The median American household checking account balance is $2,480

 

Demographics and savings

Who are the above-average saving households? Wealthier households comprise most of them, but less-well heeled households can have healthy levels of savings as well. When you look at households who have saved more than the national average of $183,200, 59 percent of them are top income earners– those households in the top 20 percent of annual income. But 41 percent of above average savers are in the bottom 80% by income.

    • Millennial households have saved an average of less than $25,000, Gen Xers have about $128,000 saved, while baby boomers have saved nearly $280,000.
    • Regardless of income or age, 29% of households have less than $1,000 saved.

When savings is viewed through certain demographic prisms, like age, income and education, the average and median savings account balances start making more sense. For instance, it won’t surprise anyone that households with higher incomes save more than those of more modest means.

 

So although the average American household has saved roughly $180,000 in various types of savings accounts, only the top 10%-20% of earners will likely have savings levels approaching or exceeding that amount. Indeed, and as the chart above shows, the bottom 40% of American households are more likely than not to have any savings whatsoever. Conversely, the top 10% of the population by income is likely to have many times the national household savings average.

Similarly, millennials will have saved less than boomers, as the latter has had a 35-year head start, among other factors. Currently, the average boomer has roughly 11 times the amount saved as the average millennial.

 

How much does the average American have in savings for retirement?

Of course, many American households store much of their savings in retirement accounts, like 401(k) plans from their employers and IRAs, both of which are tax-advantaged accounts that can hold not only “liquid” savings but also investments like financial securities and, in some cases, other types of assets like real estate. Fifty-two percent of households have some sort of retirement account, according to a 2016 survey by the Federal Reserve.

Among all households (including those with no account), the average retirement savings account balance as of June 2019 is $149,800.

But among households with an account (about 52% of all households):

  • American households with a retirement account (accounts like employer-sponsored 401(k) plans and IRAs) have an average of $287,740 in such accounts.
  • The median household balance as of June 2018 is $75,480 among those with retirement accounts.

For those households with retirement accounts, here’s how retirement savings break out among the different generations:

  • Millennials have saved an average of $34,570
  • Gen Xers have an average of $168,480 in retirement savings.
  • Baby boomers and those born before 1946 have an average of $386,110 in retirement accounts.

Recent trends in deposit accounts

Here’s a closer look at how customers of banks and credit unions are allocating their deposits:

CDs are finally getting attention

The amount of savings in FDIC-insured banks have grown by nearly $4 trillion since the recession.

 

But until recently that deposit growth wasn’t going into CDs. Collectively there’s still less savings in CDs than ten years ago, while $2 trillion more have gone into savings accounts, and $2.2 trillion in Money Market Deposit Accounts (a type of savings account that typically allows checkwriting).

 

CD yields

As you may suspect, the primary culprit behind declining CD deposits are the accounts’ low yields. As illustrated in the chart below, the popularity of CDs has waned as banks paid relatively little interest for all CDs, even those with longer maturities. For much of the past decade, the average yield for locking up savings in 1-year CD barely exceeded the average yield on a money market account, which is more liquid than a CD.

 

Longer-term CDs haven’t been yielding much more, until recently. Although the Federal Reserve began its most recent series of short-term rate hikes in early 2017, CD yields only started to climb from rock bottom in spring 2018. And as you might expect, as the yields for CDs increased, the deposits from savers have followed. Over the past year CDs at commercial banks grew by 17%, to $1.86 trillion in June 2019.

 

Credit unions: A smaller pool with slightly better yields

While savings have also increased in the much smaller credit union universe, CD deposits have remained steady.

 

While there are multiple explanations for the steady share of CDs at credit unions, such as the institutions’ not-for-profit status (members are the shareholders), one obvious reason is the competitive rates they offer customers relative to banks. According to the National Credit Union Administration (NCUA) quarterly survey, credit unions usually offer consistently higher rates on savings than commercial banks.

 

Fortunately, savers (or would-be savers) are not consigned to improving-but-still-meager average savings yields. The best yields for savings accounts, CDs and money market accounts well exceed the average APY by at least one percentage point and often more.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Chris Horymski
Chris Horymski |

Chris Horymski is a writer at MagnifyMoney. You can email Chris at [email protected]

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7 Money-Saving Tricks to Transition Your Garden From Summer to Fall

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

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Gardening is a popular, though pricey, hobby. According to the National Gardening Association, Americans spent a record-breaking $47.8 billion on their gardens in 2018. But those greenbacks put green thumbs to good use — beyond maintaining an attractive landscape, there are many physical and psychological benefits associated with spending time outdoors tending to plants, including more exposure to sunlight (and, in turn, Vitamin D), stress relief and increased physical activity. One study even found that daily gardening could lower one’s risk of developing dementia by 36%.

With summer winding down, you can still reap the mental and physical rewards of your plant-based investment. Below, we’ve offered a series of tips and tricks for maintaining your budget while transitioning your garden into cooler seasons.

Plant fall-friendly plants and veggies

Levi Gardner, founder and co-executive director of Urban Roots, a nonprofit community farm, market and educational center, said that although we primarily think of spring as the prime season for planting, there is still room for growth once the weather cools down.

“Whether it’s adding a discounted fruit tree in the fall or planting more cold-hardy veggies, the end of summer and fall is still a great time for planting,” said Gardner, who is also an adjunct professor of Environmental Studies at Grand Valley State University in Michigan.

Spinach, for example, can still grow even when it’s as cold as 15 degrees outside, Gardner said. Kale, chard, broccoli, garlic and leeks are also worth considering when it comes to cold-weather-friendly plants.

“Don’t give up on the garden just because the days are getting colder,” Gardner said.

Save your seeds for next year

One great way to save money when transitioning your garden from summer to fall is by harvesting seeds from your plants and saving them for the next growing season. In order to ensure your harvested seeds last until the next season, dry them and store them in an airtight container somewhere that’s cool and dry.

Gardner recommends people take a look at the book Seed to Seed: Seed Saving and Growing Techniques for Vegetable Gardeners for a primer on seed saving for both edible and ornamental plants.

If you can’t save your seeds, purchase some at a discount

At the end of summer, many big-box retailers have seed donations, as well as discounted seeds for sale. Taking advantage of free or cheap seeds can help you prepare for your next growing season without dipping into your savings.

“Germination rates may be low, but sometimes places like Family, Farm & Home or Tractor Supply Plus have discounted seeds,” Gardner said. Johnny’s Selected Seeds also has a sale section online, so be sure to check there, too.

With low germination rates, however, you can expect some to be duds. To save yourself disappointment during the next planting season, use this trick to judge a seed’s viability: let them sit in water for about 15 minutes, and if they sink, they’re still good to use. If they float, they most likely won’t sprout.

Separate mature perennial plants and sell what’s leftover

One way you can make a little extra cash come the end of summer is by splitting your mature perennial plants. Some perennials (think hosta, sedum and daylilies) spread easily, so once they’re mature, you can carefully divide them and plant (or sell) the extras.

With cooler temperatures than summer, splitting perennials during the fall can help improve your chances of success — just make sure you give them enough time to root before the really cold weather kicks in.

Compost your food waste

Gardner said composting is not only a great way to save money on waste, but also to grow a more beautiful garden and be more environmentally conscious. Because composting is a form of fertilizer, it’s a DIY project that helps you save money on future lawn maintenance expenses.

“Fall is a great time to set up a composting system if you haven’t already,” Gardner said. “Coffee grounds? Spread them right on the soil. Anything else can fit in a small, DIY compost area to put on your garden before winter shows up.”

In order to remain nutrient-rich, compost needs to maintain some moisture when being stored. If you have the space, consider leaving it outside covered with a tarp. It will be protected from the elements, but still allow for some rain and snow to keep it fresh. Otherwise, try keeping it in garbage bags or cans, just make sure to check the moisture levels and stir it regularly.

Mulch to save water and suppress late-season weeds

Another great way to save money while transitioning your garden from summer to fall is by mulching to save on water expenses, which will also suppress late-season weeds. “Water bills generally don’t cost too much, but if you are like me, you don’t want to spend any more than necessary,” Gardner said. “After mowing your lawn, use the grass or the weeds you pulled to mulch around the base of your plants.”

Whether you’re growing edibles or ornamentals, Gardner said, using any available organic mulch will help cut down on what is called evapotranspiration, which is the combination of loss of water through both the plant and the surface of the soil.

Although mulching can be done with weeds or grass, it can also be done using newspaper or old straw (but not hay, Gardner noted). “Organic mulch will help suppress late-season weeds while also cutting back on your water needs for the season,” he said.

Extend your growing season a bit longer

If you’re looking to extend the growing season where you live, Gardner said you can consider using a cold frame, hoop house or mini greenhouse to keep your garden producing plants all year long. If you’re an avid gardener and anticipate growing plants for years to come, this could be a worthwhile investment in the long run.

“From repurposing old windows to building a low tunnel with old conduit, there are lots of options to add length to your season, keep your garden producing and learn a new skill in the process,” he said.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Jamie Friedlander
Jamie Friedlander |

Jamie Friedlander is a writer at MagnifyMoney. You can email Jamie here

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5 Ways to Defeat Decision Fatigue

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

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It happens to all of us at some point. Two (or more) roads diverge in the (metaphorical) wood, and you have no earthly idea which is the right one to take.

There’s the anxiety of major life decisions, of course, like deciding whether or not to accept that new job offer, or discerning whether your partner is “the one.” But even smaller decisions can become impossible when you’re faced with a slew of them: What are you going to wear today? What’s for breakfast? Will you hit the gym after work or attend that volunteer meeting? Should you or should you not buy that exciting (but unnecessary) new piece of technology?

Making decisions takes effort, and when we’re faced with too many decisions at once, we sometimes get just plain sick of it. And although having the freedom to choose is a privilege, it can also lead to significant headaches — and we don’t just mean the physical kind. Decision fatigue could spell trouble for your future and your finances.

What is decision fatigue?

What decision fatigue really boils down to, said Tess Brigham, a San Francisco-based psychotherapist and life coach (who sees a lot of it in her mostly-millennial client base), is having too many options to choose from, which can lead to a paralyzing fear of making the wrong choice.

The problem presents itself in a couple of ways, in her experience: people either find themselves going in circles, continually making decisions only to fail to stick to them, or they get stuck entirely, unable to make a move.

In bad cases, even minor, day-to-day decisions can become difficult to make — including something as simple as choosing what to eat for lunch. And along with leaving her clients in a life lurch, unable to move forward, decision fatigue can also lead to classic anxiety symptoms, like sleeplessness or lack of concentration.

Most importantly for our purposes here at MagnifyMoney, decision fatigue can cause its sufferers to make less-than-savvy financial decisions. When you’re already dealing with all that psychological weight, it’s easy to forget about your long-term financial goals, whether they include funding your savings account or tackling your overwhelming debt.

In fact, Brigham confirmed that I’d fallen victim to the problem in my own life: desperately in need of a car and sick of the full-time job it had become to shop for one, I ended up simply buying one off the lot at the sticker price. After a week of frantic test drives and back-and-forth conversations at dealerships, I signed the loan without even trying to negotiate, which could potentially have saved me hundreds, or even thousands, of dollars.

5 ways to conquer decision fatigue

We’ve established that decision fatigue can be costly — not to mention downright uncomfortable. So how can you go about conquering it in your own psyche?

Here are a few tactics.

1. Limit your choices.

We often think that having more choices is better. But as it turns out, having more choices makes decision-making even harder — and, in fact, may lead us to make no decision at all.

In an oft-cited 2000 study by psychologists Sheena Iyengar and Mark Lepper, shoppers at a high-end grocery store encountered a spread of gourmet jam to sample: either 24 flavors or six. Although the larger display drummed up more interest, when it came time to talk turkey, the smaller display won out. While almost 30% of shoppers who’d sampled from the smaller table bought a jar, only 3% who’d sampled from the large table did.

This research suggests that having too many options can paradoxically arrest our ability to make a choice in the first place. With so many available options, it’s hard to discern which one is best.

Thus, intentionally limiting your choices can go a long way toward fending off decision fatigue. To extend my personal example, I test-drove many cars I knew didn’t quite fit my requirements, which wasted both my time and energy. I might have been better equipped to negotiate at the end if I’d simply said “no thank you” to the ones I knew weren’t going to work.

2. Know your values.

According to Brigham, one of the main reasons people encounter decision fatigue is a lack of clarity about their own values. They may know what they really want to do, but the pressure of what they’re “supposed to” do gets in the way of following their gut.

So when you’re facing a big choice, it’s helpful to sit down and think about what really matters to you personally. Would you rather have an adventure today or security later? Do you prefer things or experiences? One way to solidify your priorities is to make a budget, including allowances for the things that you care about, whether that means traveling as often as possible or keeping yourself decked out with all the latest gadgets.

“You can only make choices and decisions based on what’s important to you,” Brigham said. It’s when you make choices based on outside influences that you run the risk of being regretful later.

3. Automate the day-to-day.

Steve Jobs famously wore the exact same uniform every single day: a black turtleneck, jeans, and sneakers. Casting aside the fact that that seemingly-simple turtleneck cost almost $300, there’s an important lesson to learn here with regard to decision fatigue.

We make countless decisions a day (some experts estimate it in the tens of thousands), so automating the basics can leave you more energy to expend on the stuff that matters — and you won’t find yourself tapped out by lunchtime. Speaking of which, many people also eat the exact same lunch every day, which might also dial down your decision fatigue, so long as you can stomach the idea (pun intended0.)

4. Make a “not-yet” pile.

If there’s an option that’s especially hard to let go of psychologically but is not feasible right now (financially or otherwise), Brigham suggests putting it in your “not-yet pile,” which can be a list of life choices that are still on the table for someday, but that you’re not going to make just yet.

For example, maybe it’s on your bucket list to move to New York City, but you need to stay in your current job to create an emergency fund first. Or maybe you dream about driving a Ferrari, but know a Honda Civic makes more sense for now.

Either way, just because something isn’t going to happen right now doesn’t mean it never will. Remembering that you likely still have plenty of time to get there can make decision-making a lot less psychologically fraught — and maybe keep you from a costly bought of emotional spending you’ll likely regret within a week or so.

5. Try not to take it so seriously.

Here’s the thing: although every decision seems like a major deal as it’s happening, chances are, most of them won’t make a huge difference in a year or two. Even big life decisions can usually be reversed. (After all, the American divorce rate hovers around 50%.)

“It’s fear that gets in our way of making decisions,” Brigham said. “At some point, you just have to pull the trigger.” Remembering that almost nothing in life is permanent can make it a little bit easier to take the big leap, especially if you’ve also followed the rest of the advice on this list.

The bottom line

Decision fatigue can make us feel powerless to choose among the options that face us, especially when we have too many alternatives or have to make too many decisions in a short period of time. In some cases, that can lead us to make moves that are unwise financially.

Fortunately, assessing our values, limiting our options, and remembering that very few things are permanent can help us get past our analysis paralysis, and maybe even save us a few dollars in the process.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Jamie Cattanach
Jamie Cattanach |

Jamie Cattanach is a writer at MagnifyMoney. You can email Jamie here