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Ever wondered, “How much does the average middle class person have in savings?” You’re not alone. It’s a big question nowadays, especially when many are trying to make the best financial moves for the future. Here’s a closer look into how the middle class handles saving money and how having a high yield savings account could be the game changer.
Read More: 6 Genius Things All Wealthy People Do With Their Money
American households, on average, had $41,600 in savings, based on figures from the Federal Reserve in 2019. In 2022, that amount rose to about $62,500–which not only includes savings, but also assets from checking, money market accounts prepaid debit cards and more. This statistic provides a baseline understanding of where the average household stands but also emphasizes the how different demographics and economic backgrounds have been saving.
Savings by Gender and Age Group
In a survey conducted by GOBankingRates, the financial state of the average middle-class American reveals some figures about their savings and checking accounts. Remarkably, 41% of women and 34% of men report having $100 or less in their checking accounts. When it comes to savings accounts, the situation doesn’t improve much, with 39% of women and 33% of men having $100 or less. On the brighter side, there’s a small percentage that stands out: 11% of women and 15% of men have managed to accumulate $10,000 or more in savings.
Millennials and Gen X: A Struggle to Save
The financial situation for millennials and Generation X is particularly alarming, with over 40% reporting less than $100 in their checking accounts. These figures underscore the need for enhanced financial literacy and saving strategies among these age groups, highlighting a critical area for intervention.
How To Save With High-Yield Savings Accounts
Adding a high-yield savings account to your financial plan can be a key move to get past a savings slump. These accounts help you earn more from the money you save and also get you into the habit of saving regularly. This shows just how crucial it is to make smart choices with your money for a better future.
Find Accounts with the Best Interest Rates
To find accounts offering competitive interest rates, consider looking into various high-yield savings accounts, some of which feature interest rates exceeding 5.00% APY. Among these options are accounts like the Wealthfront Cash Account and the Salem Five Direct eOne Savings Account. Using a high-yield savings account with a higher interest rate can be advantageous for your financial health, as it helps your savings grow more efficiently over time.
High-Yield Savings and Financial Planning
Adding a high-yield savings account to your money plan can really help you get past a tough spot with saving. These accounts let you earn more on the money you save and help you get into the habit of saving regularly. This shows why it’s so important to make smart money choices for your future.
6 Tips for Growing Your Savings
Saving money doesn’t have to feel like an uphill battle. Here are some strategies that can help you not only increase your savings but also make your money work smarter for you. From leveraging high-yield savings accounts to exploring additional income streams, these tips are designed to guide you towards a more secure financial future.
1. Make the Most of Your Money
To give your savings a boost, exploring high-yield savings accounts is a great first step. Beyond that, embracing other wise financial practices can make a significant difference. This includes improving your budgeting techniques, reducing unnecessary expenditures, and even automating your savings to ensure a portion of your income is saved before you have a chance to spend it. Remember, every small effort counts towards building a larger savings.
2. Learn as You Go
Becoming more knowledgeable about your savings begins with understanding the tools at your disposal, like high-yield savings accounts. Expanding your financial literacy by learning about different savings strategies, investment options, and the basics of personal finance can greatly enhance your financial well-being. The more you know, the better equipped you’ll be to make decisions that positively impact your savings over time.
3. Set Clear Financial Goals
Setting specific, measurable financial goals can provide direction for your saving efforts. Whether it’s saving for a down payment on a house, an emergency fund or retirement, having clear targets in mind helps you stay focused and motivated. Break down your larger goals into smaller, manageable milestones to track your progress and make adjustments as needed.
4. Review and Adjust Your Budget Regularly
Regularly reviewing your budget allows you to adjust for changes in your income and expenses, ensuring you’re always allocating money towards your savings goals. This ongoing adjustment process helps you stay on top of your finances and identify areas where you can cut back on spending and increase your savings rate.
5. Explore Additional Income Streams
Consider ways to increase your income through side hustles, freelance work or investing in income-generating assets. Additional income can accelerate your savings growth and help you reach your financial goals faster. Be creative and explore opportunities that align with your skills and interests.
6. Use Technology to Your Advantage
Leverage financial apps and tools to track your spending, budget and savings. These tools can provide insights into your financial habits and help you identify opportunities to save more. Many apps also offer features like automated savings plans and investment advice, making it easier to grow your savings with minimal effort.
By incorporating these strategies into your financial plan, you can effectively grow your savings and improve your financial health over time.
Final Take
Looking into how much the middle class saves shows us there’s a lot to consider, like how much money people make, changes in the economy and personal money choices. Knowing that American households had an average of $41,600 saved up tells you a bit about what’s currently happening, but it also shows how different everyone’s savings can be.
Using high yield savings accounts is a smart way for many to grow their savings a bit faster. As most people try to do better with our money, the most important thing is to keep learning, be ready to adjust when things change and use the best tools out there to help you save more.
Editor's note: This article was produced via automated technology and then fine-tuned and verified for accuracy by a member of GOBankingRates' editorial team.
Our in-house research team and on-site financial experts work together to create content that’s accurate, impartial, and up to date. We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct. You can learn more about GOBankingRates’ processes and standards in our editorial policy.
- Federal Reserve. "Survey of Consumer Finances (SCF)."
- Federal Reserve. "Changes in U.S. Family Finances from 2019 to 2022."
