How Much Money Frugal People Generally Have in Their Savings Accounts

Andrew Lisa

Thu, Jan 23, 2025, 10:42 AM 4 min read

Personal finance experts have long advised their clients to adopt the spending habits of the frugal — and who could argue otherwise? After all, frugal people spread their dollars further by committing to a life of spending carefully, deliberately and sparingly.

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But what about their habits around saving all that money they’ve work so hard not to spend? While the thrifty are like everyone else in that no two are alike, they tend to share a few common approaches to saving money that are as efficient and admirable as their strategies for spending it.

It’s Simple: By Spending Less, Frugal People Have More To Save

Carter Seuthe, CEO of Credit Summit, has worked with many budget-minded clients throughout his years in the financial industry. Along the way, he has noticed a pattern: Cautious spenders tend to place a higher premium on money in the bank than those who are freer with their dollars.

“Frugal people, by nature of spending less money, often have more money in their savings accounts than non-frugal people,” he said. “I often see that frugal people prioritize emergency savings more than non-frugal [people]. It’s difficult to give a number as to how much money the average frugal person keeps in their savings since frugal people can have vastly different wealth statuses.”

There is, of course, no one dollar amount that applies to the savings accounts of all or most people with tight spending habits. But, in most cases, their fiscally prudent lifestyles allow them to do what most people can’t: Save the recommended amount or more.

At Least Enough To Survive 3-6 Months on Savings Alone

Standard personal finance advice recommends building enough savings to get through a quarter or even half a year without a paycheck. Even so, most Americans have either nothing or barely enough to get through a modest emergency costing a few hundred bucks — not so for those who pinch pennies as a lifestyle.

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“Frugal individuals typically maintain a substantial portion of their income in savings accounts, aiming for an emergency fund equivalent to three to six months’ worth of living expenses,” said Michael Ashley, a former high-level manager at Wells Fargo and Citi and founder of the personal finance site Richiest.com.

“This prudent approach provides a financial safety net, shielding them from unforeseen expenses like medical emergencies or job loss. By prioritizing liquidity and security, savings accounts offer easy access to funds without exposing them to market volatility. While returns may be modest, the peace of mind and flexibility afforded by this strategy aligns with the risk-averse nature of frugal savers, fostering a sense of financial stability.”

‘A Prudent Stash and Purposeful Reasoning’

Aleksey Krylov, a certified financial analyst and managing director at FTERA Advisors, has decades of experience in financial planning and advisory. His experience has taught him that thrifty people often treat three to six months of expenses as merely a foundation of savings on which to build. From there, they work toward financial security based on worst-case scenario planning.

He calls the process “a prudent stash and purposeful reasoning.”

“I’ve noticed that frugal individuals often go beyond the conventional three to six months rule,” Krylov said. “Some opt for a dynamic approach, tailoring their emergency fund to personal circumstances. They factor in job stability, industry volatility and individual risk tolerance. It’s not a one-size-fits-all game. It’s about crafting a financial shield that suits your unique situation.”

Low-Risk Investments as an Extension of Savings

As the owner of We Buy Houses 7, Angela Wang has seen many buyers achieve the dream of homeownership through a lifelong commitment to frugality. She has noticed that with them, the line between saving and investing isn’t always as stark because the investments they pursue tend to reflect their practical mindset.

“They’re not just satisfied with a traditional savings account,” Wang said. “They venture into low-risk investments like index funds, bonds or retirement accounts, which allow their money to grow steadily.”

A Comprehensive Financial Approach

Wang echoes the other experts in saying that frugal people are much more likely to build the recommended three to six months’ worth of expenses that many others strive for but so few actually achieve.

But, as with Ashley, what stands out to Wang more than dollar amounts is how frequently the frugal mindset leads to a structured approach to saving.

“Frugality isn’t just about numbers,” Wang said. “It’s a symphony of financial decisions harmonized by these individuals. It’s a comprehensive approach where mindful spending, purposeful saving and strategic investing dance together. The amount in a frugal person’s savings account isn’t just a balance. It’s a testament to their commitment to this unique financial dance, perfectly choreographed for their individual circumstances and aspirations.”

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