The Average Savings of Americans Has Dwindled by $11,000 to Stand at $63,000
- The average savings among American adults have declined by 15% in the last year.
- From a high of $73,000 today, many adults save an average of $63,000.
- Despite the drop in savings, many say they have adopted better financial habits from the pandemic's onset.
Americans saved less money this year compared to last year. According to a MoneyZine data presentation, Americans saved an average of $63,000 in 2022. That was a drop of $11,000 from the $73,000 that they saved in 2021. The statistics represent a 15% decline in their savings over the last year.
This decrease in savings can be attributed to several factors. With the easing of the pandemic's ravages, many Americans have eased on the financial discipline that grew at scourge's peak. The rising cost of living and stagnant wages make it increasingly difficult for many Americans to save for the future.MoneyZine's CEO, Luke Eales
The decline in savings is likely to hurt the economy as a whole. Consumer spending accounts for around 70% of economic activity, and if people are not saving, they are less likely to spend. This could lead to a slowdown in economic growth.
COVID-19's Disruptive Influence
The pandemic has disrupted the way Americans manage their finances. MoneyZine's analysis shows that over 60% of American adults deem the epidemic to have disrupted their financial management plans. 48% say they've been able to realign them to the pandemic's after effects, while 13% haven't.
Moreover, 43% of American adults claim to have recovered the financial ground they lost in 2020. Another 30% say they're yet to recover, while the remaining 27% claim the COVID-19 crisis didn't change their financial standings.
The pandemic has altered the American public's views on savings. MoneyZine concludes that the scourge has pushed 60% of Americans to grow their savings between 2020 and 2022. Additionally, 69% of these intend to keep their new levels of savings moving forward.
Americans Have Adopted Better Financial Habits
Americans seem more conscientious about their spending and saving habits in the wake of the pandemic. According to a recent survey, 73% of adults have adopted better financial habits due to the pandemic.
73% of those expect to maintain those habits in the future, a significant drop from 95% who said the same in 2021. Nonetheless, it underscores a commitment to discipline concerning personal finances.
Towards Financial Resilience
American savings habits have also changed in response to the COVID-19 pandemic. 44% of respondents have adjusted their financial planning to account for emergencies and risks. And overall, Americans are reporting high confidence levels in managing their finances.
Eales concludes, "The coronavirus pandemic has shined a light on the importance of financial wellness and created an impetus for change. People are reassessing their finances and looking for ways to become more financially resilient."