Wealthy Americans are not leaving as much cash in their checking and savings accounts as they used to. Instead of piling money into their low interest bank accounts, many are redirecting that cash into places that promise higher returns and a bit more protection from inflation.
New research based on millions of bank customers shows that, once rising prices are taken into account, balances in basic checking and savings have stayed flat for nearly two years. Among high income households those balances are now shrinking, even as total cash across all types of accounts begins to grow again. So where did the money go, and what does that mean for everyone else.
Why wealthy Americans are pulling cash from checking and savings accounts
Researchers at the JPMorgan Chase Institute examined anonymized data from about 4.7 million Chase households in 2025. They found that balances in basic checking and savings accounts are lower than historical trends would predict, while total cash reserves have returned to positive growth as households move money into other kinds of accounts.
The same work shows that higher income customers have seen real bank balances fall by roughly two percent by October 2025. For many of these households, the drop is less a warning sign and more a deliberate strategy, as they transfer extra cash into higher yielding products instead of letting it sit in a low rate account.
Inflation is a big part of the story.Consumer prices in the United States are still rising at close to three percent a year, while the average savings account at a traditional bank pays around 0.4 percent interest. When your grocery bill and rent keep edging up, leaving money in an account that barely earns anything can feel like watching it shrink in slow motion.
Where the money is going now
One major destination for this cash is the high-yield savings account. These accounts, often offered by online banks, pay interest several times higher than the national average while still allowing quick access, with top rates near five percent in late 2025. Certificates of deposit, or CDs, offer another option by locking money in for a set term in exchange for a fixed rate that can look attractive as the Federal Reserve trims interest rates.
Money market accounts at banks and money market funds at investment firms sit in the middle between savings and investing. Bank money market accounts work like savings accounts with limited check writing and are usually insured, while money market funds invest in short term government or company debt and aim to keep the value steady while paying a competitive yield.
Brokerage accounts and retirement plans such as 401(k)s and individual retirement accounts are picking up some of the rest. Some higher income households appear to be moving part of their idle cash into diversified portfolios of stocks and bonds inside these accounts, hoping to benefit from market gains and tax advantages. Homeowners with equity are also turning to home equity lines of credit, or HELOCs, flexible credit lines secured by the house that charge interest only on the amount used, although the home itself can be at risk if payments are missed.
What this shift means for everyday savers
The headline that bank balances are down can sound alarming on its own. Yet consumer confidence surveys and income data point to a more complicated picture, where many families have just enough income to cover rent, groceries, and the electric bill but feel nervous about big extras, so they try to make whatever cushion they have work harder.
For everyday savers, the key is not to copy wealthy households blindly but to match each dollar to a goal. Short term needs, like an emergency fund, usually fit best in high yield savings or a conservative money market account where the balance is stable and easy to reach, while money that will not be needed for several years may work in a CD ladder or a diversified investment portfolio as long as the saver accepts that higher returns come with real risk.
Experts often suggest three questions before moving money out of a simple bank account. What is the money for, how soon might it be needed, and how much loss could you tolerate if markets turn just when you need the cash. Clear answers to those questions, more than chasing the very highest advertised rate, are likely to matter most for long term financial health.
The main analysis behind these trends has been published by the JPMorgan Chase Institute.
