How Much Money Does the Average American Have in Their Bank Account?

A bummed American, with little money in his bank account, is counseled by his wife

A bummed American, with very little money in his bank account, is counseled by his wife | Hulton Archive/Getty Images

Despite living in what is likely the wealthiest nation to ever have existed, Americans sure are having a hard time getting by. As most people are well aware of this point, wage stagnation and numerous structural economic changes over the years have led to a shrinking middle class, fewer and fewer “good” jobs, and calls for political policies that were once thought to be too poisonous to touch — like a $15 minimum wage, for example.

Given that most people are, relatively speaking, doing just fine, what do Americans have to whine about? We have refrigerators, televisions, smartphones — all things that are inconceivable in many parts of the world, even to this day. But still, people can’t escape the feeling that the screws continue to turn. While facing even more uncertainty about the future, Americans are turning to strongmen political figures or false hopes that things will turn in their favor.

Are Americans truly struggling? It’s impossible to levy one simple judgment that encapsulates everyone in the country, but we can look at averages. And a good place to start is to look at how much money the average person has in their bank account.

Even this might not paint the most accurate picture, as incredibly high earners and billionaires can skew the numbers quite a bit, while those who are deep in debt will still have some money in an account somewhere, but it does give us a starting point.

The average American’s bank account

Money stuffed under a mattress

Cash stuffed under a mattress; a poor substitute for a savings account | iStock.com

As for how much the average American has in their bank account, all signs point to $4,436 — a number that comes from a study by bank consulting firm Moebs Services in 2014. This is an amount that accounts for averages in people’s checking accounts specifically, and was notable a couple of years ago because it represented a significant jump from 2012’s numbers. What’s even more amazing is how much higher that figure is than it was in 2007, just prior to the Great Recession.

At that time, the average American only had $788 in their checking accounts. One reason for the change? More people want to have cash on hand for immediate expenses, rather than having it tied up in retirement accounts or other investments. It’s not necessarily that people are richer — though we’re clearly in a better economic situation — it’s that people are managing their finances differently.

But having a few thousand in your bank account is a bit different than being wealthy. As mentioned, people are going to have money in the bank; it’s when you incorporate debt and other factors that we get a more accurate picture of the average American’s actual financial status.

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

Savings account?

Broken piggy bank with coins and hammer

Broken piggy bank with coins | iStock.com/wpd911

The average American may have some financial liquidity available in their checking account, but when it comes to a savings account or investments, it’s not as pretty of a picture.

A lot has been made of the “retirement crisis” in America, with lots of people headed for retirement with little or no savings and investments. And millions more are not making enough to cover basic living costs, let alone saving their sock money for later. A 2015 survey from GOBankingRates really drives this point home.

According to that survey, 62% of Americans have less than $1,000 in savings. About 21% don’t even have a savings account. Here’s a visual to bring it all together:

The average American's savings account

A graph showing the average American’s savings account | GOBankingRates.com

The rather alarming status of America’s savings is mirrored by other studies as well. Notably, a 2013 report from the Federal Reserve says that of the 4,000 or so people that were surveyed, “31 percent of respondents reported having no retirement savings or pension, including 19 percent of those ages 55 to 64, and 25 percent didn’t know how they will pay their expenses in retirement.”

For a lot of people, this means one thing — they’re one or two missed paychecks away from being in a lot of trouble.

Strengthening your financial picture

A couple looks over their finances

A couple looks over their finances | iStock.com

You may be reading through all of this and thinking that you’re surprisingly below average. But there are tons of factors that can play into how much liquid cash you have at any given time. Worrying about how you stack up to your friends, family members, and neighbors won’t do you much good. You can, however, start looking at your personal finance strategies to put yourself on more solid ground.

The first and most basic thing you can do is to put a budget together. This can be as simple as taking your income into consideration and noting your monthly expenses. If your expenses gobble up all of your income, you’ll need to look for areas to save money. This is easier said than done, of course. But if you can free up some money somehow (cancel cable TV, perhaps, or renegotiate a payment plan), you’ll find some wiggle room.

Then, the goal is to start saving. There are many strategies and methods you can use to start saving and investing. The first step in almost all of them is to build up an emergency stash. That’s basically a savings account containing enough money to cover your expenses for several months. In the event of some sort of medical emergency or job loss, this is your lifeline.

Before you know it, your accounts will be above average, and you’ll be able to sleep at night.

Start building wealth

Young people in a bank vault shoveling gold coins

Young people shoveling tons of gold coins inside a bank vault | Fabrice Coffrini/AFP/Getty Images

Your emergency savings is only the first step. You’re going to want to keep your budgeting and belt-tightening habits in place as much as possible. Your real goal isn’t to just become “average,” after all. You’ll want to start saving and investing so that you can tackle both short- and long-term financial goals. That means paying your light bill this month and retiring at some point. Hopefully.

If you want to get to work immediately, there are two main things you can do: Find ways to increase your income or continue cutting expenses. You can live like a hermit caveman if you want, but most people want to enjoy their lives a little. So, don’t go crazy with the expenses.

When it comes to increasing your income, you have a lot of options. You can pick up a side gig, working for Uber or getting a second job, for instance. Or you can ask for a raise. You can also find another job that is willing to pay you more. It’ll take some work, but job-hopping can land you a big raise. Assuming you play your cards right.

If you do manage to get your hands on some extra money, be sure to put it to work. You don’t need to upgrade every aspect of your lifestyle. Start investing. Get an IRA, start buying investment funds, or even buy property or start a business. Building wealth requires a multi-pronged blitzkrieg. But it’ll only bear fruit if you remain disciplined.

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