Two-thirds of Americans report feeling behind on their savings goals as mounting living costs continue to erode financial security for those seeking to build a nest egg for emergencies and retirement.
At a Glance
- Nearly two-thirds (67%) of Americans feel they’re falling behind on their savings goals
- Almost half (47%) believe they will never catch up on their savings
- 63% of Americans with savings have withdrawn funds this year, with unexpected expenses being a primary reason
- The average American saves about $496 monthly, but 30% save $200 or less
- Generational differences show Gen X most likely to report decreased savings while Gen Z reports more increases
Financial Struggle Becoming the Norm
A recent survey reveals a troubling financial reality for many Americans over 40: saving money is becoming increasingly difficult. Nearly half (47%) believe they will never catch up on their savings goals, painting a bleak picture of long-term financial security. The pressures of inflation and rising costs of daily necessities have created a perfect storm that’s eroding the financial foundation many hoped to build for their future years. For those approaching retirement age, this savings gap represents a particularly concerning threat to maintaining quality of life in later years.
The survey, conducted with 2,000 Americans evenly split by generation between March 28 and April 2, 2025, was commissioned by consumer banking app Current for National Financial Literacy Month. It highlighted that the average person manages to save approximately $496 per month. However, this figure masks a significant disparity – nearly one-third (30%) of respondents report saving $200 or less monthly, an amount that health experts warn is insufficient to build adequate emergency funds or prepare for retirement.
Dipping Into Savings Becoming Common Practice
The data shows that 63% of Americans with savings have withdrawn funds this year, with nearly one in five doing so five or more times. This frequent tapping into savings accounts represents a significant obstacle to long-term financial growth, as compound interest can’t work its magic when savings are constantly being depleted. The most common reasons cited for these withdrawals include unexpected expenses, everyday purchases, emergencies, and housing payments such as rent or mortgage.
“Over 60 percent of people have needed to use their savings this year, highlighting exactly why Americans are smart to try and build this financial cushion. Their savings are successfully serving their intended purpose — helping navigate both unexpected costs and ensuring they can maintain their essential needs,” explains Erin Bruehl.
The survey also revealed that 25% of respondents have less money in savings now than at the start of 2025, a concerning trend for older adults who have less time to rebuild their financial reserves. Only 18% reported withdrawing money for something they were specifically saving for, suggesting that most withdrawals are reactive rather than planned, disrupting carefully laid financial strategies.
Generational Differences in Savings Patterns
Interesting generational disparities emerged from the survey data. Gen X – those currently in their mid-40s to late 50s – reported the highest likelihood of decreased savings. This generation faces unique financial pressures, often supporting both aging parents and adult children while simultaneously trying to prepare for their own retirement. Conversely, Gen Z showed the most positive trend, being most likely to report increased savings, perhaps reflecting lower fixed expenses or different financial priorities at their life stage.
Banking relationships also show significant generational differences. The survey found that 71% of Gen Z find their bank helpful in reaching savings goals, compared to lower percentages in older generations. This suggests that younger consumers may be better served by modern banking tools and services, or perhaps are more adept at utilizing digital features that facilitate saving. Interestingly, 52% of Gen Z believe they could get more from another bank, and 45% are willing to switch institutions to improve their financial position.
Strategies for Improving Financial Health
Financial experts suggest that using savings is not inherently negative, as it serves its intended purpose of managing unexpected costs and essential needs. However, consistent depletion without replenishment creates long-term financial vulnerability. For adults concerned about their financial health, strategies for boosting savings include setting small, achievable goals, automating regular transfers to savings accounts, identifying and reducing everyday expenses, and maintaining consistency in savings habits even when amounts must be small.
“Americans should select financial institutions that help them reach their goals. Online or mobile-only solutions often offer higher savings rates than traditional banks without monthly or minimum balance fees and provide additional benefits like early paycheck access and fee-free overdraft protection that provide additional cushion when bills are due. These benefits put more money in consumers’ pockets and can help people achieve their goals faster,” advises Erin Bruehl.
For many Americans over 40, the path to financial security requires reconsidering traditional banking relationships. Online or mobile-only banks often provide better savings rates and benefits than traditional institutions, without monthly fees or minimum balance requirements. These advantages can be particularly helpful for those trying to rebuild or strengthen their savings in preparation for later life stages. The findings suggest that financial literacy and appropriate banking tools become increasingly important as individuals navigate the complex landscape of preparing for their financial future amid rising costs of living.
