The Decline in Household Savings: A Pressing Nationwide Concern

Over the past five years, American households have faced a financial challenge that demands our attention: a significant decline in their savings. In 2019, the average household savings account balance stood at $80,203. By 2023, that number had dropped to $54,150—a concerning 32.5% decrease. This issue isn’t confined to specific regions or demographics; it’s a nationwide reality affecting families in every corner of the country, including Memphis where the average household savings account balance in 2023 was $ 50,000.
 
This trend reflects the shared economic uncertainty and financial strain many households have faced recently. The COVID-19 pandemic disrupted nearly every aspect of life, forcing families to dip into savings to cover job losses, reduced work hours, and unexpected medical expenses. Inflation has only compounded the challenge, as rising costs for essentials like groceries, gas, and housing have eroded purchasing power and made it harder to set money aside for the future.
 
At the same time, wages have struggled to keep pace with the cost of living, putting further pressure on families trying to maintain or grow their savings. Debt has also grown heavier for many, with rising interest rates making it increasingly difficult to balance loan repayments and savings. As people seek a return to normalcy after the pandemic, discretionary spending on travel, dining out, and entertainment has rebounded, often at the expense of savings.
 
The implications of this decline in savings are profound. Without a sufficient financial cushion, families are left vulnerable to unexpected expenses—whether it’s a medical emergency, a car repair, or the loss of a job. Beyond that, diminished savings can delay or derail long-term financial goals, like purchasing a home, funding a child’s education, or building a secure retirement.
This is not a challenge we can solve alone, but it is one we must confront together. As an investment advisor, a Memphian, and someone deeply committed to the well-being of our community, fostering financial resilience must be a priority. Families need access to the tools, education, and resources that empower them to take control of their financial futures. Employers, policymakers, and financial professionals all have a role to play in helping Americans rebuild their savings and strengthen their financial foundations. Your involvement is crucial in this collective effort.
 
At Duncan Williams Asset Management, we have always focused on partnering with clients to provide clarity and guidance, especially during uncertain times. We offer personalized financial planning, investment strategies, and educational resources to help families navigate these challenges. I firmly believe that by working together—with intention and focus—we can turn this challenge into an opportunity for growth. We can help families recover and thrive, creating more potent, more resilient communities in the process.
 
The decline in household savings is a wake-up call but also a chance to reimagine financial security and how we can achieve it. By encouraging smart decisions, fostering long-term planning, and supporting each other as a community, we can help households regain stability and build a brighter future.
This moment calls for action, and I’m optimistic about the difference we can make together. Whether it's through financial literacy programs, policy advocacy, or community support initiatives, there are many ways we can work together to improve financial resilience in our community.
 

Disclaimer: This article is for informational purposes only and should not be considered as financial or investment advice. Individuals are encouraged to consult with a qualified financial advisor to address their unique financial situations and develop a personalized plan. The opinions expressed here are based on current trends and data and are not guarantees of future outcomes. The information provided does not constitute an offer to buy or sell any financial products or services.

Sources

·  DepositAccounts Study on Household Savings
https://www.depositaccounts.com/blog/households-savings-study.html

·  Forbes Article on Savings Distribution Among Americans
https://www.forbes.com/advisor/banking/savings/average-american-savings/

·  Forbes Article on High-Yield Savings Accounts
https://www.forbes.com/advisor/banking/savings/best-high-yield-savings-accounts/

·  Motley Fool Report on Retirement Savings Concerns
https://www.fool.com/research/average-retirement-savings/

·  Santander Bank Survey on Financial Literacy and Savings
https://www.santanderus.com/news_press_article/most-americans-missing-out-on-earning-higher-interest-on-savings-santander-bank-survey-finds/

‍