Is Your Bank Balance ‘Normal’? Here’s What the US Average Is for 5 Types of Accounts
Comparing your financial progress to the national average is not keeping up with your neighbors. It is about understanding the state of American stability.
Whether you’re looking at the cash in your checking account or the long-term growth of your 401(k), the numbers tell a story of a big difference. While some households have been able to effectively roll over their savings in the fight against inflation, much of the country still has a very small cushion.
Here’s a look at the average balances of various accounts.
1. Bank accounts
Average balance: $62,410
Median balance: $8,000
According to Bankrate, the average American household holds about $8,000 in checking accounts, including savings, checking and money market funds. This figure represents the median, which is often a more realistic benchmark than the average.
The average balance is so high because it is skewed by the fact that a small percentage of wealthy families hold large sums of money.
2. Retirement accounts for older workers
Age 45-54 average balance: $67,796
Age 55-64 average balance: $95,642
Retirement savings is a critical measure of long-term financial health, and the difference between the “average” and the “median” is stark for these age groups. For workers ages 45 to 54, the average balance is $188,643, but the average is much lower at $67,796.
The numbers jump dramatically as retirement approaches. For those ages 55 to 64, the average rises to $271,320, while the typical (median) worker earns about $95,642. This gap suggests that while many are saving, a large proportion of the workforce may need to participate in their final working years.
3. Life savings accounts
Average balance: $3,997
Average investor: Over $18,000
Health Savings Accounts (HSAs) have become a popular tool for both medical expenses and tax-advantaged investing. According to recent industry reports, the average balance across all accounts is $3,997.
Interestingly, many people use these accounts as pass-through vehicles – depositing money and spending it quickly at doctors. Only about 10% of account holders actually invest their HSA funds, but those with very high balances, often exceed $18,000.
4. Checking accounts
Average checking balance: $16,891
Median checking balance: $2,800
Checking accounts are meant for paying money, but the amounts stored here are often lower than recommended. Although the average is skewed by wealthier households, the average balance for the average American is $2,800.
Low balances in these accounts increase the risk of overdraft fees. While checking accounts don’t have to be full, keeping enough to cover a full month’s expenses provides the necessary safety net.
5. Contingency funds
Number of people with three months of savings: 55%
Number of people with no savings: 19%
The gold standard for financial security is a fund that covers at least three to six months of living expenses. Recently, about 55% of seniors reported that they had enough saved up to pay for at least three months.
The remaining 45% are in critical condition. About 19% of US adults have no emergency savings at all, meaning any car repair or medical bill that might be put on a credit card.
