Is $10,000 in Savings a Good Amount? (2024)

FAQs

Is $10,000 in Savings a Good Amount? ›

Having $10,000 in savings is a good amount. It provides a strong financial buffer and opens up opportunities for further financial growth and security.

According to experts, having $10,000 in savings is an excellent position to be in, and there are several smart moves you can make to optimize your financial situation. “If you have $10,000 in savings, the best way to use it depends on your current financial situation,” said Jake Hill, CEO of DebtHammer Consolidation.

You should keep enough money in checking to cover your monthly bills with some wiggle room – about a month of expenses. That's much lower than the three to six months' worth of expenses you should keep in your savings account for emergencies. Read: Best Checking Accounts.

For savings, aim to keep three to six months' worth of expenses in a high-yield savings account, but note that any amount can be beneficial in a financial emergency. For checking, an ideal amount is generally one to two months' worth of living expenses plus a 30% buffer.

At least 20% of your income should go towards savings. Meanwhile, another 50% (maximum) should go toward necessities, while 30% goes toward discretionary items.

There's nothing wrong with keeping $10,000 in a savings account. But it might not earn you the highest yields. CDs and brokerage accounts could be better homes for your cash in some situations.

Gaines reiterates that even most high-yield savings accounts lose value to inflation over time. “More than two months' worth of living expenses in a savings account is too much given the ability to earn around 5% from easily accessible money market accounts that should not fluctuate in price.”

Frequently asked questions (FAQs) How much does the average American have in savings? Excluding retirement assets, the average American has $65,100 in savings, according to Northwestern Mutual's 2023 Planning & Progress Study.

Americans say you need a net worth of at least $2.5 million to feel wealthy, according to Charles Schwab's annual Modern Wealth Survey, which surveyed 1,000 Americans ages 21 to 75 in March 2024. That's up slightly from $2.2 million, compared with last year's survey results.

What is a good amount of savings? ›

Put 20% of your income into savings

As well as putting money aside for a 'rainy day', there are lots of things you could save up for, such as home refurbishments, a holiday, a new car, or even a deposit on your first home.

For most, $10,000 is a lot of money. Typically, that amount of money doesn't just appear out of thin air without some financial strain. However, if you think about $10,000 as saving a little over $27 each day, it becomes much more realistic.

All in all, depositing $20,000 in a savings account can be wise if you have a short-term plan for the money. Your deposit will be safe and you can generate decent amounts of interest in the meantime.

Is $10,000 in savings good? Overall, $10,000 is a positive step toward financial security, but whether it's "good" depends on your individual circ*mstances and financial goals.

It's generally advised to save three to six months' worth of expenses in an emergency fund. With our example, your emergency fund should ideally be $15,000 to $30,000.

The FDIC recommends keeping at least six months' expenses in an emergency fund. While $5,000 in savings is nothing to scoff at, it probably isn't enough for most people to meet that criteria.

For most, $10,000 is a lot of money. Typically, that amount of money doesn't just appear out of thin air without some financial strain. However, if you think about $10,000 as saving a little over $27 each day, it becomes much more realistic.

So, regardless of any other factors, you generally shouldn't keep more than $250,000 in any insured deposit account. After all, if you have money in the account that's over this limit, it's typically uninsured. Take advantage of what a high-yield savings account can offer you now.

Americans say you need a net worth of at least $2.5 million to feel wealthy, according to Charles Schwab's annual Modern Wealth Survey, which surveyed 1,000 Americans ages 21 to 75 in March 2024. That's up slightly from $2.2 million, compared with last year's survey results.