Many Americans have long struggled to build savings. However, high inflation and interest rates since the COVID-19 pandemic have made it even more difficult for people to save for emergencies.
Only around 2 in 5 (41 percent) Americans would use their savings to pay for a major unexpected expense, such as $1,000 for an emergency room visit or car repair, according to a new Bankrate poll. That’s down from 44 percent a year ago. Instead of reaching for their savings, other people would pay for a $1,000 unexpected expense by financing it with a credit card they’d pay off over time, reducing their spending on other things, taking out a personal loan, borrowing from family or friends or other methods.
This data comes from Bankrate’s yearly Emergency Savings Report, an exclusive survey-based report conducted by Bankrate and polling partner SSRS. Since 2014, the survey has annually polled 1,000+ U.S. adults about their levels of debt and emergency savings. The most recent data, polled in December 2024, specifically examines what’s causing people to save less and how people would feel about affording their living expenses in case of a loss of income.
In the last several years, Americans have reckoned with a number of economic headwinds, from high inflation to a slowing job market. Now, 73 percent of Americans say they’re saving less for unexpected expenses due to inflation/rising prices, elevated interest rates or a change in income or employment status.
It’s unclear how the economy will continue to affect Americans’ savings in 2025. On the positive side, inflation has slowed significantly since peaking in 2022. But the inflation rate is still above the Federal Reserve’s target, leading the Federal Reserve to continue slowing the economy by keeping its federal funds rate higher for longer. What’s more, economists expect the unemployment rate to reach 4.4 percent by December 2025.
We are essentially a paycheck-to-paycheck nation. Fewer Americans have the equivalent of a financial safety net to cover inevitable unexpected expenses, despite low unemployment and steady growth.
— Mark Hamrick, Bankrate Senior Economic Analyst
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Only around 2 in 5 Americans would pay for an emergency from their savings
Forty-one percent of people would pay a major unexpected expense (such as $1,000 for an emergency room visit or car repair) from their savings. This is down from 44 percent in 2024, and after three years of progress, this is the lowest the percentage has been since 2021, when it was 39 percent:
Source: Bankrate Emergency Savings Surveys
Note: Not all percentages total 100 due to rounding.
Another 25 percent of people would use a credit card to pay for an unexpected $1,000 emergency expense and pay it off over time, up from 21 percent in 2024, and the same percentage seen in 2023.
“The cost of living continues to rise, prompting more individuals and households to turn to credit cards when in a bind,” Bankrate Senior Economic Analyst Mark Hamrick says. “They are a terrific tool when used wisely and effectively. But with interest rates still high, we need to avoid a deepening debt burden which could make it more challenging to save.”
Additionally, 13 percent of people would reduce their spending on other things to afford an unexpected $1,000 emergency expense, 13 percent would borrow from family or friends, 5 percent would take out a personal loan and 4 percent would do something else.
The economy is hurting Americans’ savings
Though inflation is no longer rising as quickly as it did in recent years, more people this year feel the economy has affected their savings. Nearly 3 in 4 Americans (73 percent) are saving less for emergency expenses due to inflation/rising prices, elevated interest rates or a change in income or employment. This percentage is up from 68 percent in 2024.
Source: Bankrate Emergency Savings Surveys
Note: Not all percentages total 100 due to rounding.
More than 2 in 3 Americans worry they wouldn’t be able to cover their living expenses if they lost their job
With unemployment expected to hit 4.4 percent by the end of 2025, the majority of Americans feel unprepared. More than 2 in 3 people (69 percent) would be very or somewhat worried they wouldn’t be able to cover their immediate living expenses over the next month if they were to lose a primary source of household income tomorrow (e.g., a job loss). That includes 46 percent who would be very worried — up from 42 percent in 2024.
Source: Bankrate Emergency Savings Survey, Dec. 6-9, 2024
Note: Percentages don’t total 100 due to rounding.
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We asked: If you were to lose a primary source of household income tomorrow (for example, a job loss), how worried are you that you would not have enough emergency savings to cover your immediate living expenses over the next month?
Year Year Not too/not at all worried 2025 69% 31% 2024 66% 34% 2023 68% 32% Source: Bankrate Emergency Savings Surveys
Only 31 percent of people say they are not too worried or not at all worried.
“We don’t know what the future of the economy might bring, but an increasing share of people are anxious about potential job loss or interruption in income,” Hamrick says. “By prioritizing saving, we can be better prepared for the unexpected and attain greater financial confidence and capability.”
Gen Zers are likelier than other generations to say they would be very or somewhat worried about having enough emergency savings to cover their immediate living expenses if they were to lose a primary source of income tomorrow:
- Gen Zers: 80 percent
- Millennials: 72 percent
- Gen Xers: 72 percent
- Baby boomers: 58 percent
The results of this data are only a few months after many Americans said their emergency savings weren’t where they wanted them to be. As of September 2024 polling in a separate Bankrate Emergency Savings Survey, 62 percent of people said they felt behind where they should be on saving for emergencies, including 37 percent who felt significantly behind and 26 percent who felt slightly behind. Only around a quarter (23 percent) of people said their emergency savings are on the right track.
Also, at the time, 33 percent of people said they had less emergency savings than they did at the beginning of 2024. Additionally, 17 percent of people said they had no emergency savings at the beginning of 2024 and still had none in September.
As of May 2024, over 1 in 4 people have no emergency savings
Keeping at least three months of expenses saved can help you weather a job loss, major unexpected bill or other sudden expense. However, as of May 2024 polling, 27 percent of U.S. adults have no emergency savings at all, the highest percentage since Bankrate asked the question in 2020.
Generationally, Americans vary widely in their emergency savings levels. Over 1 in 3 (34 percent) millennials have no emergency savings, the highest percentage of any generation:
- Gen Zers: 29 percent
- Millennials: 34 percent
- Gen Xers: 31 percent
- Baby boomers: 16 percent
Source: Bankrate survey, May 17-20, 2024
Note: Percentages don’t total 100 due to rounding.
Almost 3 in 10 (29 percent) of people have some savings, but not enough to cover three months’ expenses. That percentage hasn’t changed much since 2022 and 2023, when 28 percent and 30 percent of people said the same, respectively.
In 2024, that percentage is far higher for some generations, specifically Gen Zers. More than 2 in 5 (44 percent) Gen Zers have some savings, but less than would cover three months of expenses, the most of any generation.
Lastly, only 28 percent of people have at least six months’ expenses saved, down from 30 percent in 2023. Another 16 percent of people have between three and five months’ expenses saved, the lowest percentage since 2018.
How to start saving now
If you’re one of the 27 percent of Americans with no emergency savings, know it’s not too late to start. Bankrate’s savings guides can show you how to begin today, even if you’ve never opened a savings account before.
How to start saving
Nearly half (46 percent) of baby boomers have at least six months of expenses saved. Bankrate Chief Financial Analyst Greg McBride points out that building an emergency savings cushion doesn’t happen overnight, so the years baby boomers have had to save puts them ahead compared to other generations.
But even if you haven’t had decades to save, it’s not too late to start saving more today.
“To establish an emergency savings cushion, or add to what you have, set up a direct deposit from your paycheck or an automatic transfer from your checking account into a dedicated savings account,” McBride says. “Automating the savings is the key to making it happen, particularly with household budgets so tight.”
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Without the income to funnel into savings, lower-income households are more likely to have no emergency savings than higher-income households. Nearly half (46 percent) of households with an income under $50,000 per year have no emergency savings, compared to only 7 percent of those making $100,000 per year or more:
We asked: How much do you have in emergency savings – that is, money that is readily available in either a checking account, savings account, or money market?
 Annual income of less than $50,000 Annual income of $50,000-$74,999 Annual income of $75,000-$99.999 Annual income of $100,000 or more Source:  Bankrate survey, May 17-20, 2024 No emergency savings 46% 19% 7% 7% Some, but less than would cover 3 months’ expenses 32% 33% 31% 22% 3 to 5 months’ expenses 11% 18% 24% 21% Enough to cover 6 months’ expenses or more 11% 30% 38% 50%
Over half of Americans are uncomfortable with their level of emergency savings
Just under 6 in 10 (59 percent) U.S. adults are uncomfortable with their emergency savings, including 32 percent who are very uncomfortable and 27 percent who are somewhat uncomfortable. On the other hand, 41 percent are comfortable with their emergency savings, including 14 percent who are very comfortable and 28 percent who are somewhat comfortable.
Two-thirds (66 percent) of Gen Xers are uncomfortable with their emergency savings, the highest percentage of any generation (compared to 63 percent of Gen Zers, 60 percent of millennials and 51 percent of baby boomers:
Source: Bankrate survey, May 17-20, 2024
The high percentage of people uncomfortable with their emergency savings can be attributed, in part, to rising inflation. In 2021, 48 percent of people said they were uncomfortable with their level of emergency savings. The next year, as inflation rose, the percentage jumped to 58 percent. Inflation has remained stubbornly high, and the percentage of people uncomfortable with their savings has since plateaued:
- 2020: 44 percent
- 2021: 48 percent
- 2022: 58 percent
- 2023: 57 percent
- 2024: 59 percent
Majority needs at least 3 months of expenses saved to feel comfortable
The majority (89 percent) of Americans say they would need at least three months of expenses saved in order to feel comfortable. Moreso, 63 percent would need to have at least six months of expenses saved to feel comfortable and 26 percent would need between three and five months of expenses saved.
Most generations roughly agree they would need at least three months of expenses saved to feel comfortable. However, 72 percent of baby boomers and 70 percent of Gen Xers would need at least six months of expenses saved, higher percentages compared to younger generations:
Source: Bankrate survey, May 17-20, 2024
Amount of savings versus comfort with savings
People who have at least three months’ worth of emergency savings tend to be most comfortable with their amount of savings. Nearly three-quarters (72 percent) of U.S. adults comfortable with their emergency savings have enough to cover at least three months of expenses. Specifically, 52 percent of people comfortable with their level of emergency savings have at least six months of expenses saved.
On the other hand, 40 percent of people who are uncomfortable with their emergency savings have no emergency savings and 36 percent have something saved, but less than three months of expenses.
As of January 2024, more than 1 in 3 Americans have more credit card debt than emergency savings
More than 1 in 3 (36 percent) U.S. adults had more credit card debt than money saved in an emergency savings account in both 2023 and 2024. But, the majority (55 percent) of U.S. adults had more emergency savings than credit card debt in 2024. That’s up from 51 percent in 2023 and is the highest percentage since 2018.
Additionally, 10 percent of Americans had no credit card debt or emergency savings at all, the lowest percentage in the poll’s 14-year history:
Note: Not all percentages total 100 due to rounding.
Source: Bankrate survey, January 19-21, 2024
Millennials and Gen Xers were more likely than other generations to have more credit card debt than emergency savings:
- Gen Zers: 32 percent
- Millennials: 46 percent
- Gen Xers: 47 percent
- Baby boomers: 24 percent
Average credit card rates, as of December 2024, are at 20.27 percent. If you’re carrying a credit card balance, you may end up paying a great deal of money in interest.
“Financing purchases at 20 percent interest rates is a sign of the financial strain millions of households are feeling,” McBride says.
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Women are more likely than men to have more credit card debt than emergency savings, or to have neither:
We asked: Thinking about the amount of credit card debt you now have and the money you have in your emergency fund or savings account, which is higher?
Gender Credit card debt Emergency savings No credit card debt and no emergency savings Source: Bankrate survey, Jan. 19-21, 2024 Women 40% 48% 12% Men 31% 62% 8% Additionally, the likelihood of having more emergency savings than credit card debt rises with income:
We asked: Thinking about the amount of credit card debt you now have and the money you have in your emergency fund or savings account, which is higher?
Year income Credit card debt Emergency savings No credit card debt and no emergency savings Source: Bankrate survey, Jan. 19-21, 2024 Less than $50,000 42% 40% 18% $50,000-$74,999 39% 57% 4% $75,000-$99,999 38% 59% 4% $100,000 or more 21% 78% 1%
Americans want to improve both their debt and savings
Regardless of their financial situation, more people in 2024 said they wanted to tackle both debt and savings, compared to 2023: 36 percent of U.S. adults said they’re prioritizing both paying down debt and increasing emergency savings. It’s the highest percentage in seven years, and up slightly from 2023, when 34 percent of people said the same.
When picking between the two, more people said they were prioritizing emergency savings. Around 1 in 4 (28 percent) people were prioritizing boosting emergency savings, but that’s the lowest percentage yet in Bankrate’s polling. Another 25 percent were prioritizing paying down debt, up from 23 percent in 2023:
Note: Not all percentages total 100 due to rounding.
Source: Bankrate survey, Jan. 19-21, 2024
“Recognizing that the cost of carrying debt has increased significantly in the past two years and the insufficient level of emergency savings, more Americans are focusing on both paying down debt and boosting emergency savings simultaneously, rather than one to the exclusion of the other.” McBride says. “Having a direct deposit from your paycheck into a dedicated savings account automates the savings, allowing you to channel your take home pay toward the goal of paying down debt.”
All generations were more likely to prioritize both on paying down debt and increasing emergency savings, rather than only focusing on one. Notably, 43 percent of millennials are prioritizing paying both at the same time, while 22 percent are only paying down debt and 29 percent are only increasing emergency savings.
In 2024, nearly 1 in 3 people had more emergency savings than they had in 2023
In 2024, almost a third (30 percent) of U.S. adults said they have more emergency savings now than they had a year ago, the highest percentage in Bankrate’s polling since 2020.
Another 32 percent of people said they had less emergency savings than they did in 2023 — down from 39 percent in 2023, and the lowest percentage in five years.
Another 29 percent said they had the same amount of emergency savings as 2023, and 9 percent had no emergency savings in 2023 or 2024:
Note: Not all percentages total 100 due to rounding.
Source: Bankrate survey, Jan. 19-21, 2024
3 tips on building your emergency fund amidst high inflation
Building an emergency fund can be a lifeline if your income decreases or you lose your job. Here are three tips on how to start and maintain an emergency fund to prepare for uncertainty.
1. Figure out how much you need in emergency savings
Experts commonly recommend saving three to six months of expenses in case of emergencies. For example, if your monthly bills total $2,000 a month, saving $6,000 will allow you to pay your bills for a short time if you lose your main source of income. This is not a concrete rule; you may need to save more if you are self-employed and anticipate a lean month, or if you are preparing for a major lifestyle change, like an upcoming move or a new baby.
2. Open a savings account just for emergencies
Different emergency funds allow you to protect your savings and allow you quick access when you need the money. An online savings account, money market account, money market mutual fund or a separate savings account with your existing bank or credit union can allow you to save emergency funds for the future.
“An action item for this new year should be to prioritize financial well-being,” Hamrick says. “At the top of list, use direct deposit for a dedicated emergency fund. By choosing a high-yield insured savings account, your money will be working for you and accessible when needed.”
3. Make a budget around savings
You may already have a budget in place to make room for saving more, but make sure you stick to your good habits. Rebuilding your savings, or starting to save for the first time, can be easier by automatically transferring money to your savings each month or taking on side hustles for more income.
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