Americans Aren't Saving Money Right Now — and It's Not Just Because of Inflation Dwindling savings could mean trouble for many Americans as the threat of a recession looms.

By Amanda Breen Edited by Jessica Thomas

Westend61 | Getty Images

Though many Americans' savings accounts gained some extra padding during the Covid-19 pandemic with stimulus checks and fewer opportunities to spend, there's reason to believe those reserves will run dry soon.

Even with the threat of a recession on the horizon, Americans are spending more than they're saving, and it has as much to do with resilient consumer habits as it does inflation, Insider reported.

Related: Facebook Marketplace Scam Costs Michigan Woman Life Savings

According to a report from the Bureau of Economic Analysis, the personal savings rate, or the amount of income Americans' set aside each month, dropped to 2.3% in October.

Americans' dwindling savings can be attributed to inflation in part. Despite the Federal Reserve's efforts to battle inflation by raising interest rates, price pressures remained high in November, CNN reported.

And earlier this year, a survey from the Pew Research Center found that Americans view inflation as the top problem facing the country today.

But strong consumer spending also plays a significant role in decreasing savings. Consumer spending soared ahead of the holiday season, rising 0.5% in October from September — the largest jump since January, The Wall Street Journal reported.

Related: How Generation Z Can Jump-Start Savings (Advice Anyone Can Use)

Americans who haven't set enough money aside will find themselves in a difficult spot if the U.S. does enter a recession next year.

Amanda Breen

Entrepreneur Staff

Senior Features Writer

Amanda Breen is a senior features writer at Entrepreneur.com. She is a graduate of Barnard College and received an MFA in writing at Columbia University, where she was a news fellow for the School of the Arts.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

After a 12-Year-Old's Side Hustle Made Over $4,000 in 1 Day, He and His Dad Grew the Business to Nearly $50,000 a Month: 'It Takes Commitment'

Madden Forrest and his father, Steven, turned their passion for football into a lucrative business.

Business Ideas

70 Small Business Ideas to Start in 2025

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2025.

Business News

Mattel Signs First-of-Its-Kind Deal With OpenAI to Bring ChatGPT to 'Iconic' Toys

Mattel is also allowing its employees to use ChatGPT Enterprise to help design new products.

Business News

Google, Spotify Down in a Massive Outage Affecting Tens of Thousands. Here's What We Know.

Both Google and Spotify appear to be down for thousands of users.

Growing a Business

Your Customers Are Talking About You — Here's How to Turn Their Feedback Into Profit

Listening to your customer has always been a strategic imperative. With countless options just a click away, consumers are gravitating toward brands that make them feel cherished and involved.

Growing a Business

3 Things You Need to Know About Building a Company That Lasts

If you want to build a business that lasts, technological solutions must be inscribed into the very fabric of your company's being. Here's why.