COVID Saving Added $1 Trillion to Bank Deposits

Banks are awash in money as consumers at record rates socked away the money they didn’t spend during the early stages of the COVID-19 shutdown.

Mass Mutual survey discovered one in five of us put away at least $1,000. An ambitious 10% say they’ve saved more than $5,000 since the start of the pandemic. So much money has poured into the nation’s banks that the FDIC’s Deposit Insurance Fund fell below the statutory minimum.

The Federal Deposit Insurance Corp. guarantees money on deposit at insured banks up to $250,000. The fund is financed by fees paid by insured banks, based on their deposits, size and other factors.

Typically, when the fund falls below the required 1.35% of insured deposits, it’s because of bank failures. But in this case, the amount Americans saved during the early weeks and months of the pandemic grew so fast the ratio of the $114.7 billion fund to total deposits fell to 1.3%.

The FDIC called the influx of savings “extraordinary.”

“An unprecedented inflow of more than $1 trillion in estimated insured deposits in the first half of 2020 resulted mainly from the COVID-19 pandemic, specifically monetary policy actions, direct government assistance to consumers and businesses, and an overall reduction in spending,” said the FDIC.

The Mass Mutual survey found 46% of Americans spending less than in the past. Many spent more on food deliveries and streaming services, but almost two-thirds spent less on vacations. A majority (53%) reduced spending on day trips. Weddings, summer wardrobes and beauty care were also areas where a high percentage said they’ve reduced their spending.

Most of those who cancelled their summer vacation saved the money in one manner or another. A third put it away hoping to take a vacation later this year. 30% put it into their regular savings account; 15% added it to their emergency fund.

Among the 34% of Americans who saved at least something, 55% said not taking a vacation or doing any traveling helped them save. Many also said not going out at night, eating at home and skimping on personal care and clothing were other ways they saved.

What do they expect to do with the money they saved? 40% plan to hang on to it as an emergency fund. One-in-five will use it for necessities, to pay down debt and to eventually travel.

And when the COVID pandemic is over, 26% said they’ve developed new spending and saving habits which they plan to keep.

Photo by Austin Distel on Unsplash

#WeAreGreenKey: Spotlight on Brad Martin
Architecture + Engineering General Interest

#WeAreGreenKey: Spotlight on Brad Martin

Green Key Unlocked: Mastering your Healthcare Interview
General Interest Healthcare

Green Key Unlocked: Mastering your Healthcare Interview

Is Covid-19 Back or Are We Just Seeing a Surge in Cases?
General Interest Healthcare Pharma

Is Covid-19 Back or Are We Just Seeing a Surge in Cases?

Strategic Networking: A Secret Weapon in Job Searching
Accounting + Finance Architecture + Engineering Financial Services General Interest Healthcare Human Resources Information Technology Legal Support Marketing Technology Pharma Professional Support

Strategic Networking: A Secret Weapon in Job Searching

#WeAreGreenKey: Spotlight on Justin Nadelman
General Interest Green Key News Information Technology Leadership + Management

#WeAreGreenKey: Spotlight on Justin Nadelman

Navigating the Tech Interview Maze: A Guide to Success
General Interest Information Technology

Navigating the Tech Interview Maze: A Guide to Success

Green Key Unlocked: How to Succeed in Payroll Management
Accounting + Finance General Interest Human Resources Leadership + Management

Green Key Unlocked: How to Succeed in Payroll Management

#WeAreGreenKey: Spotlight on Jenny Rehkugler
Accounting + Finance General Interest

#WeAreGreenKey: Spotlight on Jenny Rehkugler

Handling Mistakes & Failure in the Workplace
General Interest Worklife

Handling Mistakes & Failure in the Workplace

How to Support Those Affected by Hawai’i Wildfires 
Green Key News

How to Support Those Affected by Hawai’i Wildfires 

#WeAreGreenKey: Spotlight on Halle Sarfin
Green Key News Professional Support

#WeAreGreenKey: Spotlight on Halle Sarfin

Advantages of Offering Exit Interviews
General Interest Human Resources

Advantages of Offering Exit Interviews

Tracking Metrics: Learning & Development
General Interest Leadership + Management Worklife

Tracking Metrics: Learning & Development

#WeAreGreenKey: Spotlight on Leanna Gallagher
Green Key News Human Resources

#WeAreGreenKey: Spotlight on Leanna Gallagher

How to Beat the Summer Productivity Slump
General Interest Leadership + Management Worklife

How to Beat the Summer Productivity Slump

Questions to Ask When Hiring a Recruiter
General Interest Leadership + Management Worklife

Questions to Ask When Hiring a Recruiter

#WeAreGreenKey: Spotlight on Chianté Vidal
Architecture + Engineering Green Key News

#WeAreGreenKey: Spotlight on Chianté Vidal

Celebrating 10 Years of GKR in Rockville
Green Key News Leadership + Management Professional Support

Celebrating 10 Years of GKR in Rockville

Internal Mobility: Retaining Top Talent
General Interest

Internal Mobility: Retaining Top Talent

Green Key Unlocked: The Future of Telemedicine & Virtual Healthcare
General Interest Healthcare Information Technology

Green Key Unlocked: The Future of Telemedicine & Virtual Healthcare

Latest Blog Posts
View All Posts
#WeAreGreenKey: Spotlight on Brad Martin

#WeAreGreenKey: Spotlight on Brad Martin

What I find the most rewarding is the fulfilment of seeing someone take that next step in their career while...
Read More
Green Key Unlocked: Mastering your Healthcare Interview

Green Key Unlocked: Mastering your Healthcare Interview

Staying in the same vein as preparing for success in a tech interview, let’s take a look at how to...
Read More
Is Covid-19 Back or Are We Just Seeing a Surge in Cases?

Is Covid-19 Back or Are We Just Seeing a Surge in Cases?

With the recent increase in hospitalizations and Covid-19 cases across the U.S. the question of How to protect ourselves and...
Read More