Saving money is like preventing wrinkles: the earlier you start, the better. Maybe worrying about your savings is new for you, and you don’t really know where you stand or what you should be aiming for. So, what is the average savings account balance, and is it enough? We did the digging so you can see how your stacks stack up in just seconds. Even better, we dug into what the money experts suggest for a healthy savings account so you can plan for your best life.
Even though we’re going to talk about the average savings account balance, that’s a bit of a misnomer. It’s most helpful to look at the median balance and not the average (as in the mathematical mean) balance. That’s because certain people at the high end of the range skew the numbers for everyone. So the median gives you a better idea of where most people in any given age group stand in terms of average savings account balance.
Don’t worry, that’s most of the math we’re going to deal with today. Down to the first thing you’re wondering: how do you stack up against people around your age?
What is the average savings account balance?
Like almost everything else in your life, the government keeps tabs on this. While that may be disconcerting, it does mean we have recent numbers on the average savings account balance. Americans under 35 have about $1,580 saved according to 2018 data from the Federal Reserve. But if you look at people under 35 making between $70,000 and $114,999, they’ve pocketed away more: roughly $5,400.
But what about the average savings account balance across Americans with this type of account? Even if you expand it and look at all age groups, that number is still only $5,200. Again, this is the median or “average” as in common. If you look at the mean, that amount jumps to $33,766.49 because of a small group of people who skew the numbers higher.
Here’s where everyone sits by income:
— Under $25,000: $500
— $25,000 to $44,999: $1,500
— $45,000 to $69,999: $2,200
— $70,000 to $114,999: $5,400
— $115,000 to $159,999: $10,000
— $160,000+: $50,000
Sound like a lot right now? Try using the Simple app to save more money. It helps me stash away money out of every paycheck so I forget I had that money to spend. I’ve been able to increase my savings slowly but surely using it, despite having student loans to pay off.
If you’re looking for even more tips on how to save more money, stay tuned. Dirt is working on a comprehensive guide to help you build that nest egg.