Over the past couple of years, Americans have become better at saving having a median of $7,000 in their savings account in recent studies. While average and median savings account balances estimate the same thing, the results can be different.
An average takes the sum of numbers and divides them by the number of entries. Therefore, an average balance will include very high or very low balances that can skew results. A median balance will take the number closest to the middle. Continue reading to learn more about the average savings account balance.
Average Savings Account Balance By Age
Americans tend to add more money to their savings account as they get older. Here’s a breakdown by age, according to the SCF:
- Under 35: $8,362
- 35–44: $20,839
- 45–54: $30,441
- 55–64: $45,133
- 65–74: $54,089
- 75 and above: $42,291
Median Savings Account Balance By Age
The median amount present in a person’s savings account by age shows a similar upward trend but the amount is much lower.
- Under 35: $2,600
- 35–44: $3,800
- 45–54: $4,100
- 55–64: $5,400
- 65–74: $8,000
- 75 and above: $10,000
Average Savings Account Balance By Income
As you’ve probably guessed, income can be a huge determining factor when it comes to how much someone can save. For example, households that make more than $160,000 annually tend to have more saved up than those in the lower-income brackets.
- Less than $25,000: $6,021
- $25,000–$44,999: $11,719
- $45,000–$69,999: $13,179
- $70,000–$114,999: $15,333
- $115,000–$159,999: $37,645
- More than $160,000: $117,771
Median Savings Account Balance By Income
Here’s a full breakdown of median savings account balance by percentile income.
- Bottom 20th percentile: $600
- 20.00 to 39.99 percentile: $1,700
- 40.00 to 59.99 percentile: $3,800
- 60.00 to 79.99 percentile: $8,200
- 80.00 to 89.99 percentile: $18,700
- The top 10 percentile: $62,000
Average Savings Account Balance By Gender
Women reported an average of $16,986 in their savings accounts. Meanwhile, men reported having an average of $34,942 in their savings accounts.
Median Savings Account Balance By Gender
Using this method, we are able to see an even more dramatic difference between men and women, according to statistics.
Women had a median of $2,500 in their savings account balance while men reported a median of $9,200 in their savings account. A lot of variables can be attributed to the discrepancy, such as the fact that mostly men headed 80# of the households took the survey.
Average Savings Account Balance By Race
The Survey of Consumer Finances also collects data by race. Here’s a breakdown of the data:
- Black: $10,479
- Hispanic: $24,743
- White: $33,879
- Other: $48,257
The “other” category consists of several races, including Asian, American Indian, Alaska Native, Pacific Islander, and more, according to the Survey of Consumer Finances.
How Much Should You Save?
Though age or income breakdowns seen above can serve as a guide to help you along the way, there is no set amount that you should save. Simply save as much as you can. However there are tips and tricks that will help you get started, such as the 50/30/20 rule. Here is how it works.
- 50% of your budget goes to fixed expenses, like rent or utilities
- 30% goes to non-essential expenses, like gym membership, subscriptions, or eating out
- The last 20% goes toward savings
How To Save More Money
Beside putting away money each month from your paycheck to save money, there are some other ways to exponentially grow your savings. Here are some ways you can do so.
- Open a CD. If you have a good amount of money that you won’t need in the coming future, consider a certificate of deposit. You may earn a higher guaranteed interest rate than a regular savings account. However, you’ll be penalized for withdrawing your funds before the term ends.
- Consider Investing. Unlike with a savings account, investing in stock, bonds, or mutual funds carries risk. However, if it works out, you can gain a much higher return.
- Contact a Fiduciary. Speaking with a registered fiduciary, who is legally required to act in your best interests, can help you better figure out your financial situation and grow your savings account.
Where Should You Keep Your Savings?
Choosing which type of savings can make a great impact on how much you can save. Keep in mind these factors when deciding on which route is best for you:
- Fees. Be sure to read the fine print and understand all charges associated with your account. These may include monthly maintenance fees, out-of-network ATM fees, overdraft charges, and more.
- Interest Rates. An interest rate is a percentage you earn on the total amount in your savings account. A higher interest rate means your money will grow faster. Generally, online banks offer the best rates, since they avoid overhead expenses associated with maintaining physical branch locations.
Your average savings account balance can differ greatly from the ones listed above, but it all depends on your financial situation. Think of the statistics above as a guide on how much you should save and where to start.
Use this post to create a budget to help you reach your personal goals. For more options, check out our list of the best savings accounts!
While you have your money in a savings account, you can accumulate more free money through our extensive list of the latest bank bonuses!
Leave a Reply