Here’s Exactly How Much Savings Americans Have at Every Age — And (Yes) Here’s What They Should Have

How much savings do you need?

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No matter your age, saving is a necessity, but depending on your age, the amount of savings you’ll need changes depending on your life stages and overall financial landscape. A general rule of thumb is that you should – even in times of high inflation – have somewhere between 3-12 months of basic expenses somewhere safe, like a high-yield savings account (see the best savings rates you can find here). But this depends on many factors.

How much savings do Americans have at each age?

According to the most recent data available from the Federal Reserve Board’s Survey of Consumer Finances, the median savings balance — excluding retirement funds — of Americans under 35 is just $3,240, while that jumps to $6,400 for those age 55 -64.



Under 35












Of course, this data only looks at savings vehicle balances, but it doesn’t factor in how many people have no savings at all. According to Bankrate data from January 2022, 56% of Americans would not be able to cover an unexpected $1,000 bill with savings. In other words, Americans are very, generally speaking, undernourished.

How much should you have saved at each age?

The answer to this is not entirely simple, because professionals say it really depends on your lifestyle, income, whether or not you have a mortgage, car, dependents and more. “I tend to think the best measure of how much savings you should have factors in your expenses. This includes your marital status: Someone in their 20s without a spouse or kids who rents and takes public transportation probably has very different savings needs than someone in their 30s or 40s with two kids and a stay-at-home spouse and two car payments and a mortgage,” says Ted Rossman, senior industry analyst at Bankrate.

The rough rule of thumb is that you need somewhere between 3-12 months of basic expenses in a savings account. In general, having 3 to 6 months of emergency savings is what Rossman recommends on the low end if you’re a two-income household and on the high end if you’re a one-income family supporting children. “Also, if you’re a business owner or in a field where it can take a long time to find a new job,” says Rossman. (See the best savings rates you can find here.)

It’s also important for people to consider savings goals that may be separate from emergency savings. “Someone aspiring to buy a home in the next year or two should consider opening a separate savings account for that down payment. Money earmarked for a relatively short-term goal like this probably shouldn’t be invested in stocks given the volatility,” says Rossman. However, it can also be helpful to keep it separate from emergency savings because it’s for a separate purpose and because research shows that people are more successful at saving when they have a separate account with a separate name.

A way to accelerate your savings? Designate a direct deposit amount from each paycheck into a separate savings account, says Chanelle Bessette, banking expert at NerdWallet. “It becomes much less tempting to spend that money if it never reaches the checking account. It’s natural to change your spending habits as you earn more money, but lifestyle inflation can catch up with you, so try to track how your spending changes as you get older and course-correct if you’re spending beyond your budget. your capabilities”. says Bessette.

  1. How to think about the savings you need in your 20s
    In your 20s, your financial priorities are very different from those of subsequent generations. “People in their 20s may be just starting their careers and earning an income stream while dealing with college debt. By making smart moves now, like spending wisely, automating savings and contributing strategically to your 401(k), you can enjoy the fruits of your labor today while ensuring a successful retirement in the future,” says Gabe Krajicek, CEO of Kasasa. fintech company that provides community banks with financial products and services.

  2. How to think about saving in your 30s You’re probably more established in your career and earning more, which will make saving easier. “Lifestyle creep and lifestyle changes can make a huge dent in your nest egg. Before making purchases, consider whether the spending aligns with your values ​​and brings you closer or further away from your long-term financial goals. It’s important to find areas where you can save money, such as cutting back on eating out or skipping a streaming service. You should also build an emergency fund, buy life insurance, add to your 401(k) and work with a financial advisor to ensure you’re making wise investment decisions,” Krajicek says.

  3. How to think about saving in your 40s You probably have more assets and should focus on diversifying your investment portfolio and looking for additional income streams. “If you’ve been able to lock in a low-interest mortgage, instead of making additional payments, consider investing those additional funds in a rental property or other potential passive income streams. But first, pay off debt and keep an emergency fund,” says Krajicek.

  4. How to think about saving in your 50s
    Continue to grow your retirement savings and explore long-term care insurance. This next chapter may weigh more on your mind, so assess your current trajectory and take steps to ensure you’re on the path you intended. “Use an online retirement calculator and constantly check with your financial advisor, especially with the current financial turmoil,” says Krajicek. As you get into your 50s and 60s, closer to retirement, your non-retirement savings needs may actually decrease. “Your kids may grow up and move out of the house, your mortgage and cars may be paid off, and your income will increase over time,” says Rossman. As for things that may vary with age, some important expenses and life goals will come in and out of the list. “Young adults may be especially burdened with paying off student loans, for example, but when those are paid off, that could be a savings opportunity,” says Rossman.

  5. How to think about saving in your 60s
    If you’re not comfortable with your financial picture, evaluate your income, investments, and spending habits so you can make changes. “If you’re feeling safe, maybe you’re thinking about the legacy you’re going to leave. Start planning with the people and causes you care about and make sure you protect your wealth with a solid estate plan,” says Krajicek.

Any advice, recommendations or rankings expressed in this article are those of MarketWatch Picks and have not been reviewed or endorsed by our trading partners.

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