Here's How Much the Average American Has in the Bank

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OK, so you have some money in the bank. Let's say it's divided, as it is for most U.S. families, between checking , savings, and some retirement and money market accounts. But how much total does the average American have in the bank?

As of 2022, the average American family had a combined total of $62,410 in the bank, divided between the sorts of accounts listed above, according to the Federal Reserve's Survey of Consumer Finances. But to really see how much the average American has, we need to see how much is the average in a checking account and how much is average in a savings account.

How much does the average American have in their checking account?

Generally, people should have at least three months' worth of expenses in their checking account; enough to cover groceries, bills, rent or a mortgage , and so on. Unfortunately, most Americans are nowhere near that amount. CNBC says that:

• 27% have less than $500 in checking
• 11% have between $500 and $999, and
• 23% have between $1,000 and $4,999

Interestingly, that same CNBC report finds that households that earn less than $50,000 a year typically fall under that first category, less than $500 in checking. Those earning up to $75,000 have less than $5,000 in checking, while those households earning more than $200,000 have at least $10,000 in checking.

How much does the average American have in their savings account?

According to the Federal Reserve survey, the average American family has $62,410 in their combined savings account(s).

Once again, demographics make a big difference:

• If you're under age 35, the median amount in savings alone is $5,400.
• Up to age 44, the number rises to $7,500.
• Up to age 54 is $8,700.
• Up to age 64, and it drops to $8,000.
• Up to age 74, and it jumps to $13,400.
• After that, the amount drops off to $10,000.

The amount you have in savings matters

There are three main reasons why you should work to pad your checking and savings accounts, but especially savings.

First, it helps to have an emergency fund . Bad things happen -- that's a fact. Illness, job loss, pandemics -- you get the idea. Savings are a moat against the bad financial horde. How much should you have? Three to six months is often cited as a good amount.

Second, savings help achieve financial goals , like buying a house, paying for college, starting a business, and so on.

Finally, let's not forget retirement . While this fund would likely be in a 401(k) account or IRA, it still counts. Putting, say, 10% of your pretax income away for savings each year is smart. And if your employer does some sort of match, it's even smarter.

Boost your savings

While it might seem difficult to save more money, there are a few ways to increase your savings account.

1. Pay yourself first. The great book The Richest Man in Babylon , a timeless classic, suggests that before you pay your bills and creditors, that you pay yourself first. It recommends 10% of your income go to savings.
2. Automate it. To make the process less painful, have the money transferred into your savings automatically every pay period.
3. The magic of compound interest : A high-yield savings account that compounds your interest creates money while you sleep. Doesn't that sound nice?

You may not have as much in the bank as you want or as much as others have, but the time to start is now.

Your future self will thank you.

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