Most Americans Save Wrong and It’s Costing Them

Employed Americans say they save 23% of their take-home pay, on average, according to a NerdWallet survey of more than 2,000 U.S. adults. But many aren’t saving with a clear plan.

The findings suggest that while many Americans intend to save, inconsistent habits and a lack of structure could leave them exposed when unexpected expenses arise.

The savings disconnect

According to the NerdWallet survey, more than two in five Americans with savings accounts transfer money only when it feels convenient, when their checking balance looks good, or when they think of it.

This reactive approach may feel easy in the moment, but it often lacks the structure needed to build lasting savings habits.

It’s like trying to build a house without a blueprint. You can hammer a few nails, but progress quickly stalls without a plan.

The numbers reflect that gap. While employed Americans report saving an average of 23% of their take-home pay, nearly four in ten say they save less than 20%, and nearly a quarter aren’t sure how much they save at all, NerdWallet’s reports.

Why reactive saving often falls short

Saving only when you remember to do it is hard to sustain. You pay your bills, cover daily expenses, and if anything’s left, you try to save. But this “leftover” method rarely builds lasting savings.

The NerdWallet survey shows that 21% of Americans with savings accounts only transfer money if there’s still a balance by the time they get paid again.

This approach relies on memory and timing — both of which can falter when life gets busy.

The automation advantage

According to the NerdWallet survey, only 25% of Americans with savings accounts use direct deposit to move money into savings. But this simple step can create a powerful shift in behavior.

Instead of saving what’s left after spending, you save first and spend what’s left. This strategy, known as “paying yourself first,” removes the temptation to spend money before it reaches savings.

Consider setting up an automatic transfer the day after payday, or ask your employer if you can split your direct deposit between checking and savings.

One popular guideline, the 50/30/20 budget rule, suggests using 50% of your income for needs, 30% for wants, and 20% for savings or debt payments. Automating that 20% can make the plan easier to stick to.

Building financial shock absorbers

Nearly half of Americans are saving for emergencies, making it the most common goal, according to NerdWallet. But many are still caught off guard by predictable expenses like car repairs, holiday gifts, or annual insurance bills.

These costs may not be monthly, but they’re not surprises either. NerdWallet notes that 21% of Americans have multiple savings accounts or buckets for different goals — a strategy known as using “sinking funds.”

Setting up separate sub-accounts and automating small contributions can prevent you from dipping into your emergency fund. Need $600 for new tires in six months? That’s $100 a month. Automating that amount makes it manageable and less stressful.

Small changes, big impact

NerdWallet recommends starting with just a 1% savings increase. On a $3,000 monthly income, that’s $30 — not enough to cover a major expense, but a meaningful start.

Going from saving nothing to saving something builds momentum. Once 1% feels comfortable, it’s easier to increase. Like strength training, savings habits grow over time with steady increases.

If you’re starting at 5%, try raising your monthly savings rate until you reach a sustainable target, whether 10%, 20%, or more. The sooner you build a steady savings pace, the more prepared you’ll be.

Turn intention into action

The NerdWallet survey shows that 82% of Americans actively save for something. The intent is there — but many haven’t made it easy on themselves. It’s like planting a garden but forgetting to water it. Without regular care, the results fall short.

This matters even more in a shifting economy. With interest rates likely to change and inflation still in play, having a steady savings system is essential.

According to NerdWallet, automating contributions and using high-yield savings vehicles can help savers stay on track, even if rates drop later. For example, SoFi Checking currently offers 3.8% interest, plus a potential $300 signup bonus. (May change without notice.)

For many people, the problem isn’t how much they save — it’s sticking with it. You can turn your goals into results by automating, prioritizing, and creating structure.

The best savings plan is one you don’t have to think about.