Here's How Much the Average American Needs in Savings

Savings is a vital tool to provide a household with a great deal more security than it would have otherwise. Without a healthy savings account, you can be pressured into doing work that you're not super thrilled about, or having to accept positions that aren't really ideal for you because they happen to pay better than a job that would be more in line with your interests or training.

On average, Americans have about $8,000 total in their transaction accounts, which include both checking and savings accounts, but only 45% can cover a $400 emergency expense. It's generally recommended that you have about three months of expenses set aside in an emergency fund just in case, but how much is that, really?

What are the average American household expenses?

Americans, on average, spend most of what they make -- it's a serious problem for us as a nation. According to the U.S. Bureau of Labor Statistics Consumer Expenditure Survey, the average consumer household makes about $94,000 per year before taxes and spends about $73,000 each year.

And what are we spending it on? Food at home, for example, is almost $6,000 per year, shelter is about $14,500 per year, and transportation over $12,000.

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So, for that average household, three months of savings comes up to about $18,000 -- or $10,000 more than we have on average, as Americans.

What is average, anyway?

An average American household for the purposes of this study was made up of 2.4 people, 0.6 of them were children under 18, 0.4 of them were adults over 65, and 1.3 members of the household contributed to the household's income.

But that's hardly what every household looks like, and for many, $18,000 in savings is just impossible to achieve. So, instead of just looking at averages and saying that you must have $18,000 in savings, let's see what some common household configurations should have in their rainy day fund.

Family of one

A family of one has a lot fewer needs than a family of 2.4, but that doesn't mean that they only need half the money of an average household. It's actually kind of expensive to live by yourself, and the singles tax most definitely applies in so many areas of life.

For a family of one, just under $11,000 should cover three months of expenses. That includes $794 for food at home, $2,743 for shelter, $694 for utilities, $1,515 for transportation, and $904 for healthcare costs. It might sound more attainable than $18,000, but remember the average household of one only makes $45,588 before taxes.

Family of two

A family of two comes much closer to the average household, with an income of $96,710 and a need for about $18,257 in savings. That includes $1,347 for food at home, $1,129 for utilities, $3,480 for shelter, $2,932 for transportation, and $1,671 for healthcare.

Family of four

A family of four in America generally includes children or other household members who aren't working, but averages 2.0 earners, according to the Bureau of Labor Statistics. For them, $24,000 is about three months of expenses, but with small children or elderly family members, you may actually need a bit more for surprises that can crop up.

When it comes to households with dependents, more is always better, but as always, we all do the best we can in this life.

How much do you really need in savings?

How much you need in savings really depends on your own household spending and the non-savings resources you may have to lean on in hard times. For some families, more savings may be useful if they're in a field where it can take a long time to get a new job, or if they have a medically complicated family member who may require a lot more healthcare expenses.

The best way to know for sure what your own needs are is to look at your household budget and build a savings plan from it. Including the most important expenses is a good starting point, then you can add additional funds as needed.