Average checking account balance

While most Americans strive to fatten up their savings accounts, it can be difficult to discern how much of your cash belongs in a checking account.

The dilemma: You want to have enough on hand to pay your bills, but not so much that you’re sacrificing higher-yielding options. 

The expert rule-of-thumb answer is…it depends.

“You should aim to have a month of living expenses act like a floor for your checking account,” said Kaylin Dillon, a certified financial planner.

To get a sense of where you stand compared to other Americans – the average checking account balance is just under $9,000, for instance – USA Today Blueprint broke down figures from an analysis of Federal Reserve data by the University of California at Berkeley.

Note: All averages are mean figures.

The average checking account balance among Americans tends to increase with age, since older workers have had more time to accumulate assets and gain experience to command a higher income. 

Older Americans will also typically need more money available in a checking account, said Dillion. 

An 18-year-old fresh out of high school and with no dependents has fewer daily financial commitments than someone, say, 20 years older with an established career and a family to support. 

Those in the top 10% of income distribution — defined as those who have a median income of around $390,000 in 2022, according to the Federal Reserve — have an average balance of more than $36,000 in their checking accounts. That figure drops to around $5,200 for those with a median income of $70,000 and $2,200 for those making less than $20,000 a year. 

You should consider your total income when deciding how much to keep in your checking account, but you also want to consider how often you get paid, said Marianela Collado, chief executive at Tobias Financial Advisors. 

“If you have a consistent paycheck, it might be easier to keep your checking balance a little bit leaner,” Collado said. “You know that the next deposit is coming.” 

But if you’re a freelancer or independent contractor with fluctuating pay, you may want to keep a bigger cushion so you always have enough to cover your spending.

There’s a big difference in the average checking account balance depending on your schooling, reflecting how much more the typical college graduate earns. 

The median weekly earnings of someone with a Bachelor’s degree was $1,432 in 2022, per the Bureau of Labor Statistics, compared to $935 for people with some college but no degree, $853 for those with only a high school diploma and $682 for those with no high school diploma. 

The unemployment rate also drops with higher education levels.

There are stark differences in the average checking account balances between ethnicities. For instance, Asian Americans have an average checking account balance of more than $28,000, compared to just more than $3,000 for Black Americans. 

Part of the explanation is likely due to income disparities. Asian Americans, for instance, had a median weekly income of more than $1,500 in the final three months of 2023, per the BLS, which was almost $600 more than Black workers. 

How much should you keep in your checking account?

The amount of money you should keep in a checking account will depend on your specific situation, including your income and expenses, but a useful rule-of-thumb is one months’ living expenses. 

That base number will likely increase for someone with irregular income, such as a freelance or contract worker, or if you have significant expenses, such a homeowners associations or gym membership payment, which are charged quarterly or annually instead of monthly, Dillon added. 

You also don’t want to keep too much money in your checking account, especially with the high interest rates on savings accounts. 

Excess money you’ll need in the short term or for an emergency fund is likely better off in a high-yield savings account. And don’t neglect your long-term goals, like retirement, by keeping too much money in a checking account instead of investing. 

“Beyond a certain level of living expenses, it becomes inefficient to keep a lot of money in your checking account,” Dillon said. 

How can I increase my checking account balance?

While increasing your income or decreasing your spending are obvious ways to ramp up your checking account balance, that’s not always possible. 

One trick is to enlist a budgeting tool, such as YNAB, to help. YNAB encourages you to live on last month’s income, breaking the paycheck-to-paycheck cycle. You could also consider a temporary savings gimmick, such as the 100 envelope challenge, to get a little breathing room. 

It might also be time for more structural changes, such as rearranging how you divide your paycheck into your different accounts. You could lower the amount you move automatically into savings, for instance, if your checking account is constantly being overdraft. 

If your income fluctuates, you “want to be a little more thoughtful about having a cushion,” Collado said. 

That may mean increasing that cushion so that it can cover three months of expenses, depending on your financial situation.