Though it’s not always a great idea to compare your bank account balance to other people’s, sometimes it’s nice to know where you fall along the financial scale. Here we’ll take a look at the government’s findings on what the average American bank account looks like.
Where The Info Comes From
When it comes to discovering what average assets look like, a good place to start is the Federal Reserve. Every few years, they gather consumer information and measure average checking, savings, and money market accounts – including prepaid debit cards. This is done through a survey called the Survey of Consumer Finances (SCF).
In order to understand the study, it’s important to consider that it reveals both the median and average account balances of those surveyed.
The average balance was calculated by adding up the balances of everyone surveyed and dividing the sum by the number of survey participants.
The median was calculated by arranging all the balances of those surveyed from lowest to highest and selecting the number in the middle.
Why Does It Matter?
The reason the median number is so important is because a small number of incredibly wealthy people could skew the “average” enough to make it unrealistic. For example, consider that you surveyed 5 people. If 4 of them had $10 and 1 of them had $1,000, then their average account balance would come out to be $240. Although this is their “average” balance, it doesn’t reflect what most of them actually have realistically.
The Survey’s Discoveries
According to statista.com, the average American household has right around $3,200 in their savings accounts. This is partially influenced by the events of 2020 that have left a lot of financial uncertainty for the short term future for many American families.