We all need money on hand for emergencies -- but you'll never believe how many U.S. adults are sorely lacking in this regard.
We all need money in the bank for a rainy day. After all, you never know when your car might break down, your roof might spring a damaging leak, or your employer might call you up and inform you that you're a suddenly a free agent without a paycheck.
New data from GOBankingRates, however, reveals that 69% of Americans have less than $1,000 in savings. That means they're clearly nowhere close to having a complete emergency fund, and they're taking a very big chance with their finances.
Worse yet, 45% of Americans say they have $0 in savings. That's right -- not so much as a dollar socked away in a bank account. If you're one of them, it's imperative that you work on boosting your cash reserves -- before the next financial disaster in your life strikes.
IMAGE SOURCE: GETTY IMAGES.
Why aren't we saving more?
Nearly 33% of Americans are living paycheck to paycheck, which explains their glaring lack of savings. Meanwhile, 20% point to a high cost of living as the reason their bank accounts are in such a sorry state. But even if you're grappling with big bills on a limited income, chances are, there's some way for you to eke out a modest amount of savings. And the sooner you do, the better.
How to build your emergency savings
Ideally, you should have enough money in savings to cover three to six months of essential living expenses. That sum is meant to tide you over in the event of a job loss, but also, it can get you through costly home repairs, car issues, or medical bills.
If you have less than $1,000 in savings right now, or no savings at all, you'll need to start making lifestyle changes immediately to free up more cash. First, set up a budget so you can understand what your current bills cost you. From there, identify a few expenses you can cut back on, like dining out, taking rideshares, or paying for entertainment. Will it be easy to give these things up? No -- but you can live without them, and you may have to do so for a while if you want to build savings.
Of course, you could keep spending on modest luxuries like cable but make more drastic changes, like downsizing your living space or giving up a car. Doing so would actually be a quicker path to building an emergency fund, so if you're willing to make those sacrifices, it could help your finances in a very big way.
Another option? Get a second job on top of your main one to boost your income. About 38% of Americans say a bigger paycheck would help them build savings, and the good news is that you don't need to wait for your employer to feel generous to make that happen. Instead, you can join the gig economy by tutoring, pet-sitting, blogging, or consulting in whatever you're good at. The great thing about a side hustle is that its earnings won't be earmarked for existing bills, so you can take all of the money you make from it, minus taxes, and stick it into a savings account.
Building an emergency fund should trump all other financial goals you have -- including saving for retirement. If you're sitting on less than $1,000 in the bank, or, worse yet, $0, make changes immediately. If you don't, you'll probably have no choice but to rack up debt the next time an unplanned bill lands in your lap. And that, in turn, could kick-start a dangerous cycle that hurts your finances irreparably.
FAQs
New data from GOBankingRates, however, reveals that 69% of Americans have less than $1,000 in savings. That means they're clearly nowhere close to having a complete emergency fund, and they're taking a very big chance with their finances.
What percentage of Americans have less than $1000 in savings? ›
A stunning new Bankrate survey of 1,030 individuals finds that more than half of American adults (56%) lack sufficient savings to shoulder an unexpected $1,000 expense.
How many Americans have less than $5000 in savings? ›
About 29% of respondents have between $501 and $5,000 in their savings accounts, while the remaining 21% of Americans have $5,001 or more. Few hold much cash in their checking accounts as well. Of those surveyed, 60% report having $500 or less in their checking accounts, while only about 12% have $2,001 or more.
How many Americans have at least $100000 in savings? ›
Most American households have at least $1,000 in checking or savings accounts. But only about 12% have more than $100,000 in checking and savings.
How much does the average 60 year old have saved for retirement? ›
So, the average savings is the number at which half of all money saved is above this amount and half of all money saved is below it. According to the Federal Reserve, households between the ages of 55 and 64 have the following median assets: Retirement Accounts – $185,000. Other Financial Assets – $67,700.
Does the average American have $1000 in savings? ›
Key Takeaways. More than one in four Americans (28%) have savings below $1,000. This is the case for 32% of Gen Zers, followed by Millennials at 31%, Gen X at 27% and Baby Boomers at 20%.
What percentage of Americans have $2000 in savings? ›
Majority of Americans Have Less Than $1K in Their Savings Now
| How Much Do Americans Have in Their Savings Accounts? | | |
|---|
| $101-$500 | 12.80% | 10.04% |
| $501-$1,000 | 11.30% | 12.58% |
| $1,001-$2,000 | 10.60% | 9.81% |
| $2,001-$5,000 | 10.60% | 10.64% |
4 more rowsMar 27, 2023
How much does the average household have in savings? While the median bank account balance is $8,000, according to the latest SCF data, the average — or mean — balance is actually much higher, at $62,410.
How much does the average American have in checking? ›
Average household checking account balance by age
| Age range of reference person | Average checking account balance in 2022 | Median checking account balance in 2022 |
|---|
| Under 35 | $7,355.53 | $1,600.00 |
| 35 to 44 | $15,309.92 | $2,500.00 |
| 45 to 54 | $20,155.22 | $3,400.00 |
| 55 to 64 | $17,515.35 | $3,500.00 |
2 more rowsOct 18, 2023
American households, on average, have $41,600 in savings, according to data last collected by the Federal Reserve in 2019. The median balance for American households is $5,300, according to the same data. The reality is that the above stats may not accurately reflect the financial situation of many Americans.
You can still live a fulfilling life as a retiree with little to no savings. It just may look different than you originally planned. With a little pre-planning, relying on Social Security income and making lifestyle modifications—you may be able to meet your retirement needs.
How much do most Americans retire with? ›
The average retirement savings for all families is $333,940 according to the 2022 Survey of Consumer Finances.
At what age should you have 100K saved? ›
“By the time you hit 33 years old, you should have $100,000 saved somewhere,” he said, urging viewers that they can accomplish this goal. “Save 20 percent of your paycheck and let the market grow at 5% to 7% per year,” O'Leary said in the video.
How much does the average 70 year old have in savings? ›
The Bottom Line
How much does the average 70-year-old have in savings? Just shy of $500,000, according to the Federal Reserve. The better question, however, may be whether that's enough for a 70-year-old to live on in retirement so that you can align your budget accordingly.
What is the average Social Security check? ›
Social Security offers a monthly benefit check to many kinds of recipients. As of December 2023, the average check is $1,767.03, according to the Social Security Administration – but that amount can differ drastically depending on the type of recipient. In fact, retirees typically make more than the overall average.
Do 70% of Americans have less than 1000 in their savings? ›
The result? Nearly seven in 10 Americans (69%) had less than $1,000 in their savings account. Breaking the survey data down a bit further, we find that 34% of Americans don't have a dime in their savings account, while another 35% have less than $1,000.
Do 45% of Americans have less that $1000 saved for a? ›
Less than half (45%) of Americans would be able to cover a $1,000 emergency expense without turning to a credit card or loan, according to the survey. Millions of Americans are missing out on retirement accounts. An estimated 155.6 million (60%) Americans lack a retirement-specific savings account.
What percentage of people have more than 1000 in savings? ›
Personal Savings in the U.S.
This is about as many people as those who volunteered to give answers about the status of their savings and had more than $1,000 in the bank. 18 percent said their saving were at least $1000 but under $10,000, while 11 percent each had $10,000 to $49,999 and $50,000 or more saved up.
What percentage of Americans have more than 1000 in their bank account? ›
Another 11% have a balance between $500 and $999 and 23% said they have between $1,000 and $4,999. All of these figures are well below the $6,081 that the average American household spends in a month. About one third of survey respondents said they had more than $5,000 in their checking account.
