What is the personal savings rate in the U.S., and how does yours compare?

You know saving money is important — it’s what allows you to achieve goals such as buying a house, retiring comfortably, or even going on vacation next year. But balancing saving with spending is a universal challenge, and one that doesn’t have a one-size-fits-all solution.

That’s where your personal savings rate comes in. Your personal savings rate is a measure of how much disposable income you’re able to save. Knowing this number can help you set reasonable financial goals and stay on track to reach them.

Learn more about the personal savings rate in the U.S., how it’s changed over time, and how your own personal savings rate compares.

The U.S. personal savings rate is the percentage of disposable personal income (DPI) Americans save, on average. According to the most recent data available from the Federal Reserve Bank of St. Louis, Americans had an average personal savings rate of 4.8% as of the third quarter of 2025.

The U.S. personal savings rate is an interesting data point because it reflects Americans’ financial habits and priorities. Classic financial advice often suggests saving around 20% of your paycheck for retirement and short-term savings goals. But the U.S. personal savings rate shows that most people aren’t able (or willing) to do so.

Say you bring home $5,000 each month after taxes. Your monthly spending totals $4,500, including essential expenses and discretionary spending. You’re left with $500 to save for retirement or other savings goals.

Here’s how you’d calculate your personal savings rate:

$500/$5,000 = 0.10

0.10 * 100 = 10%

In this example, your personal savings rate would be 10%.

The U.S. personal savings rate has fluctuated a lot over recent decades. In the 1960s and 1970s, personal savings rates steadily increased, reaching a peak of 15.3% in 1975. It then dropped over the following three decades, bottoming out at 1.8% in 2005 before the housing bubble collapse.

The U.S. personal savings rate grew slightly over the following few years, remaining in the single digits until 2020.

Then, when the global pandemic triggered stay-at-home orders and fewer ways to spend money, Americans’ personal savings rate surged to a new high of 24.2%. This was short-lived, however, and the rate dropped to 2.5% in 2022. As of 2025, the U.S. personal savings rate is 4.8%.

Though the U.S. personal savings rate is a useful data point, personal savings rates can and do range widely between individuals. Here are a few of the many factors — both large scale and individual — that can affect the U.S. (and your own) savings rate:

Inflation is the increase in the cost of goods and services over time, which results in the loss of your money’s buying power. It explains why $100 today won’t buy you as much as it did a decade ago.

When inflation spikes, as it did in the early 2020s, for example, your money doesn’t go as far. You may have to spend more of your paycheck on essentials, resulting in a lower savings rate.

Read more: How to protect your savings against inflation

The state of the economy obviously has an impact on personal savings rates, as proven by pandemics, recessions, credit availability, and more. When the economic outlook isn’t great, you may put a bigger emphasis on saving. Meanwhile, when you feel confident in the economy, you may be willing to spend and borrow more freely.

Your income has a massive impact on your savings rate. The more you earn, the smaller the proportion of your paycheck you need for essentials and the more you can set aside for the future.

For example, say you earn $60,000 per year and live on $50,000. This equates to around a 17% savings rate. But if your income jumps to $70,000 and you keep your living expenses the same, you’d be able to save more than 28% of your paycheck.

Read more: Gross vs. net income: Which one should you use when budgeting?

Your priorities and responsibilities change constantly throughout life, affecting how much you’re able and willing to save.

For instance, you may prioritize saving more before having kids, knowing your expenses will increase when you have to pay for day care. Or, if you’ve been saving diligently for decades and have a healthy nest egg in the bank, you may be OK with lowering your savings rate.

Read more: Average savings by generation: How do boomers, Gen X, millennials, and Gen Z compare?

As mentioned above, your personal savings rate is the proportion of your disposable personal income (DPI) you’re able to save. Here are simple steps to calculate it:

1. Figure out your monthly DPI. Your DPI is the amount of income you have left after paying taxes. To calculate it, add up all income sources and subtract any taxes you pay.

2. Add up your monthly expenditures. These include both essential and discretionary purchases.

3. Subtract your monthly expenditures from your DPI. For example, if you take home $5,000 after taxes and spend $4,500 each month, you’d subtract $4,500 from $5,000.

4. Divide this number by your DPI and multiply the result by 100. This leaves you with your savings rate expressed as a percentage.

If you calculate your personal savings rate and it’s lower than you’d hoped, it’s not the end of the world. Your savings rate may change dramatically over the course of your earning years. However, saving is key to a healthy financial future, so keep an eye on your savings rate and improve it when possible. Here are some ideas that can help:

• Start where you can. Saving a few dollars each paycheck may not feel worth it, but it’s OK to start small. Whether you’re saving $10 or $1,000, you’re establishing the habit of putting money away. Increasing your savings rate can come later.

• Automate your savings. Don’t rely on your memory and motivation to save. Instead, set up automatic transfers from your checking account to your savings account every month so saving happens on autopilot.

• Set up an emergency fund. Saving money is a lot easier when you don’t have high-interest debt eating up your monthly budget. To help avoid debt, save an emergency fund first — ideally, three to six months’ worth of essential expenses. Then, when an unexpected bill or financial emergency pops up, you can cover it without taking on debt.

• Track your spending. If you’re struggling to save, you first need to know where your money goes each month. Review bank and credit card statements to familiarize yourself with your monthly expenses. If there’s a subscription you forgot about or a purchase you regret, make any necessary changes to your budget.

• Pay yourself first. Instead of spending what you want and saving what’s left (if anything), put money in savings first. Then spend what’s left. This allows you to set your savings rate in line with your goals and ensure you hit it every single month.

• Increase your income. If you’ve done everything else and still can’t save as much as you want, brainstorm ways to increase your income. You may be able to negotiate a raise, find a higher-paying job, or start a side gig.