Smart Investments: Household Saving Rates and Tips to Help You Plan for Your Future

Written By
Julija A.
May 17,2024

Although we’re still feeling the effects of the Great Recession today, unemployment rates across the USA are low, and the economy is steadier than it has been for years. President Trump continues to reassure the American people that we’re better off now than ever before, and that we’re about to enter a period of massive growth and prosperity. While it’s unclear what the future will bring with all the political commotion surrounding us, those in charge claim we have nothing to worry about.

Here at Fortunly, this kind of rhetoric makes us wonder. If, according to our president, we’re doing so well, then why are household saving rates so low each year? 

There are, of course, several reasons. We’re here to examine these factors, but we’re also here to help you learn how to manage your own savings. We want to teach you how to save more, how to get better interest rates for your accounts, and how to build a solid financial foundation for your family. 

We’ve compiled all the info you need right here.

What are Household Savings Rates?

Household savings are taken from the leftover difference between a household’s disposable income and its expenditures. Basically, it’s all the money you have left from your monthly paycheck after paying your bills and personal expenses. So, in addition to rent, food, and utilities, expenses such as gym memberships, restaurant visits, and those hot new shoes you bought to match your favorite outfit are all taken into consideration. After all that, you can put your leftover cash into a savings account for a rainy day. 

But what are savings rates?

The household savings rate is basically the same thing represented as a percentage. It’s the percentage of money deducted from a family’s disposable income that gets set aside into a savings account. There are several types of savings accounts, and while they all serve the same purpose (multiplying your hard-earned cash and keeping it safe), there are some subtle differences between them.

Bear in mind that simply having surplus at the end of the month doesn’t mean you’re saving. Only the money you put away into a savings account actually counts. 

America’s Current Household Savings Rate

Statistics compiled by Magnify Money show that the average American household had $175,510 in its savings account in 2018. That sounds like a lot, right? Indeed, it is. Unfortunately, the average figure doesn’t reflect reality for the vast majority of Americans. This number is so heavily skewed by the extremely wealthy that it represents about 15 times more than what most people actually have. While some families live from paycheck to paycheck and don’t have a single dollar to put away at the end of the month, others manage to stash away millions. 

What we’re really looking for here is the median balance. This number shows us the midpoint value, which isn’t affected by outliers and presents a much clearer picture of the US household savings rate. As it turns out, the median American household has just $11,700 in savings. 

Only the top 10% or 20% of America’s earners have savings that approach or exceed the average figure of $175,510, while the top 1% have more than a million dollars saved across several accounts.

Here are some astounding figures that will give you an idea of just how much the average savings rate in the US differs from the median: 

Top 1%:

  • Average (all households): $2.5 million
  • Average (households with savings): $2.5 million
  • Median (all households): $1.13 million
  • Median (households with savings): $1.16 million

Top 10%:

  • Average (all households): $961,570
  • Average (households with savings): $989,430
  • Median (all households): $156,510
  • Median (households with savings): $173,860

From 60% to 79.9%:

  • Average (all households): $133,770
  • Average (households with savings): $148,600
  • Median (all households): $77,020
  • Median (households with savings): $96,800

From 40% to 59.9%:

  • Average (all households): $65,830
  • Average (households with savings): $82,730
  • Median (all households): $34,020
  • Median (households with savings): $54,930

From 20% to 39.9%:

  • Average (all households): $29,080
  • Average (households with savings): $46,950
  • Median (all households): $0
  • Median (households with savings): $26,450

Bottom 20%:

  • Average (all households): $8,720
  • Average (households with savings): $22,600
  • Median (all households): $0
  • Median (households with savings): $0

Household Saving Rate by Year

2012 2013 2014 2015 2016 2017
9.14% 6.61% 7.58% 7.83% 6.91% 6.90%


When you look at the data from year to year, you can see that savings numbers remain low. American families just don’t have a lot of money in their accounts, and according to a study from GOBankingRates, the personal savings rate in the US is even worse. Indeed, in 2017, 57% of Americans had less than $1,000 stashed away. The numbers are better compared to those from 2016, but the data is still troubling. Imagine breaking a leg, or losing your job, or having your basement flooded, or having your car break down. A lot of Americans don’t have enough cash to deal with this kind of emergency. In fact, in 2017, 44% claimed they couldn’t cover an unexpected $400 emergency and would have to borrow money from a friend or sell something to get quick cash. 

Household Savings Rate by Country/Region

Country/Region 2012 2013 2014 2015 2016 2017 2018
America 9.14% 6.61% 7.58% 7.83% 6.91% 6.90% N/A
Australia 7.48% 7.86% 7.95% 5.97% 4.85% 3.51% N/A
Canada  4.82% 5.26% 3.57% 4.15% 1.28% 1.77% 1.69%
China 38.11% 38.46% 37.99% 37.07% 36.14% N/A N/A
Euro Area 5.61% 5.67% 5.92% 5.72% 5.55% 5.04% N/A
European Union 4.93% 4.90% 4.75% 4.70% 4.41% 3.25% N/A
Greece -10.92% -16.39% -13.81% -15.47% -17.00% -16.91% N/A
Germany 9.29% 8.95% 9.49% 9.68% 9.79% 9.88% N/A
Japan 2.71% 0.30% -0.35% 0.82% 2.56% N/A N/A
Korea 3.90% 5.60% 7.18% N/A N/A N/A N/A
Mexico 14.65% 12.23% 14.06% 15.15% 15.45% N/A N/A
New Zealand 0.84% 0.61% -0.63% -0.29% 0.28% -1.38% N/A
Spain 2.35% 3.84% 3.49% 2.87% 1.83% -0.83% N/A
Sweden 14.38% 14.97% 16.41% 15.05% 16.01% 15.07% 16.79%
Switzerland 17.35% 17.53% 18.88% 17.65% 18.79% N/A N/A
United Kingdom 4.54% 3.75% 3.62% 4.55% 1.62% -0.91% N/A


The OECD economic outlook on household saving rates across countries indicates that America isn’t doing as well as it could be. Compared to countries like Sweden and Switzerland, its economy is stagnating, and this could be one reason why its savings rate is so low. However, America certainly isn’t the worst on the map — Greece is still going through a financial crisis and the situation there is getting worse for a lot of families. 

China and Sweden have the highest savings rates in the world, while the United Kingdom seems to be on a downward trajectory thanks to the political fallout of Brexit. 

How Can I Save More Money?

You need to become familiar with the different types of savings accounts before you can improve your household savings rate. Let’s go over some of the basic options: 

Savings deposit accounts

This is the most basic type of savings account. It’s an interest-based account that allows you to withdraw your money any time you like, but limits you to six withdrawals per month. These accounts are insured by the Federal Deposit Insurance Corporation (FDIC). They can provide cover for up to $250,000 in deposits. If you want to open one, bring your social security number and ID when you go to the bank and they’ll help you set everything up. 

If you want to make a very large deposit, you could try applying for a jumbo savings account. They usually require a deposit of $100,000, but they have a higher personal saving rate, which means you earn more interest. 

High-interest savings accounts

A minimum deposit balance or other requirements are usually needed to apply for high-yield savings accounts. Online savings accounts typically also offer better interest rates, so browse around to see which bank gives you the best option. 

Joint accounts

Joint accounts usually cater to married couples as a way of helping them improve their household saving rates. The only difference between a joint account and a savings deposit account is that a joint account is held by more than one party. They can be useful for families because they multiply the FDIC insurance limit by the number of account owners. 

College savings accounts

College savings accounts are usually opened by parents on the day their baby is born. Many people open a basic account to improve their household savings rate and keep enough cash aside both for college and in case of emergency. But there are also plenty of different accounts and plans designed specifically for college savings. Some of them only cover tuition costs, while others also cover boarding and study materials. 

In addition to college accounts, you can also find student accounts aimed at young people in college or high school. They generally have more flexible terms and fewer requirements before they can be opened. 

Retirement savings accounts

There are several types of retirement savings accounts. According to our US savings rate chart, Americans aren’t putting away enough money in their savings. That’s a problem, because the older you are, the more difficult it might be to plan for retirement if you don’t already have a head start. You can choose between 401(k) accounts, individual retirement accounts (IRAs), Roth IRAs, Roth 401(k), SEP IRAs, and simple IRAs. A 401(k) is an employee retirement plan offered by the company you work for, while IRAs are investment accounts you can use to invest in mutual funds, stocks, or bonds. 

Tips and Tricks to Improve Your Household Savings Rate

Make a budget

Don’t underestimate the power of simple budgeting. Before you do anything else, start tracking your income and calculate your monthly expenses. Knowing how much money you have at your disposal can help you establish a savings goal and keep you on the right track. If you need help budgeting, try apps like Penny, Mint, or Clear Money. 

Avoid debt

You can certainly improve your consumer savings rate by prioritizing your debt payments. Debt is a problem that won’t go away, and you won’t be able to improve your lifestyle or put money into a savings account until you’ve dealt with student loans, credit card debt, and the dreaded mortgage.  

Minimize expenses

Whether it’s eating out too often or ordering one too many lattes during the day, all of us have expenses we could really do without. However, don’t focus too much on the small trifles; that’s not where real cash problems arise. Focus on the big things, like your car and your house. A huge number of American households overspend and try to live beyond their means, and this only leads to financial ruin in the long run. 

Consider a side hustle

The best way to increase your household savings rate is to open up new income streams. This doesn’t mean you need to get a second job, but it’s worth considering how you can make the most of your skills by doing some freelance work on the side. You could even rent that spare room in your house or have a garage sale to raise some extra funds. If you put every single penny you earn from these ventures into a savings account, you’ll be surprised at how much you can set aside. 

Introduce no-spending days

This one is self-explanatory; a no-spending day is a day when you simply don’t touch your wallet. No cash, no credit cards, nothing. During this 24-hour period, you have to bet by on what you already have at home. This is a good way to train yourself to plan ahead, buy only the things you really need, and resist impulse purchases. The trick here isn’t to spend no cash one day and then go on a spending splurge the next day to make up for it. It’s about being sensible with your money and resisting those consumerist urges that might be encouraging you to overspend. 

In Conclusion

If you want to save more, the best steps you can take are to review your budget, prioritize debt payments, and become a thoughtful consumer. Simply becoming more actively aware of your own money and the way you spend it can increase your family’s household saving rates significantly. We hope our tips help you create a better financial strategy for the future. 


About author

Albert Einstein is said to have identified compound interest as mankind’s greatest invention. That story’s probably apocryphal, but it conveys a deep truth about the power of fiscal policy to change the world along with our daily lives. Civilization became possible only when Sumerians of the Bronze Age invented money. Today, economic issues influence every aspect of daily life. My job at Fortunly is an opportunity to analyze government policies and banking practices, sharing the results of my research in articles that can help you make better, smarter decisions for yourself and your family.

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